Payback period method, finance, Other Engineering

Assignment Help:
Non-discounted cash flow method,

Payback period method
In this method, time value of money is not considered. It takes into account the number of years required to recover the initial investment of a project (Harold Bierman, Seymour Smidt, 2006).
Accept Reject Rule:
Accept the project with lowest payback period.
Reject the project with highest payback period.
Merits:
1. Simple and easy to calculate
2. Less costly to use
3. Less time consuming
De-merits:
1. Time value of money is completely ignored.
2. Does not consider the cash flow generated after payback period.

Related Discussions:- Payback period method, finance

Identify people at risk - fire risk assessment, Identify people at risk: ...

Identify people at risk: It is often easy to forget that there may be people in a building who cannot move as quickly as the rest of us.  They may be in a wheel chair, they ma

Principal of assembly buildings- fire protection engineering, Principal of ...

Principal of Assembly buildings- fire protection engineering: As assembly buildings accommodate members of the public they often accommodate people with disabilities. People

Capital budgeting decisions, Capital Budgeting Decisions The most important...

Capital Budgeting Decisions The most important function of a finance manager is the efficient allocation of its capital. The investment decision of a firm is termed as capital budg

Wire drawing, Wire Drawing involves pulling the metal through a die by mea...

Wire Drawing involves pulling the metal through a die by means of tensile force applied to the exit side of the die.          A typical wire drawing operation is shown in fig.

Fractional distillation in fuel - aircraft maintenance , Fractional distill...

Fractional distillation This process is carried out in a fractionating column, which has a series of trays as shown in the figure. The effect of the superheated steam on the h

Industrial &production engneering, what type of topic or subject is gud for...

what type of topic or subject is gud for the project before the final year project

Credit limit, HOW WOULD YOU JUDGE THE POTENTIAL PROFIT OF BAJAJ ELECTRONICS...

HOW WOULD YOU JUDGE THE POTENTIAL PROFIT OF BAJAJ ELECTRONICS

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd