COST ACCOUNTING
CAPITAL BUDGETING
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
Capital Budgeting techniques used to analyze projects
|
|
Net present value (NPV), Internal Rate of Return (IRR), Payback period, Profitability index, Book rate of return
|
|
|
Financial Planning, Marginal Costing, Fund Flow Analysis
|
|
|
Financial Statement Analysis and Budgetary Control
|
|
|
Cash Basis, Accrual Basis and Hybrid Method
|
Explanation:
Detailed explanation-1: -Payback Period, Net Present Value Method, Internal Rate of Return, and Profitability Index are the methods to carry out capital budgeting.
Detailed explanation-2: -Capital budgeting is the process by which investors determine the value of a potential investment project. The three most common approaches to project selection are payback period (PB), internal rate of return (IRR), and net present value (NPV).
Detailed explanation-3: -Internal Rate of Return method computes the discount rate at which the difference between the present value of an investment project’s future net cash flows and net initial cash outflows is 0, i.e., the IRR is the discount rate that sets the NPV to 0.
There is 1 question to complete.