Student #: 1480510 Introduction Capital budgeting is the most important management tool that enables managers of the organization to select the investment option that yields comprehensive cash flows and rate of return. For managers availability of capital whether in form of debt or equity is very limited and thus it become imperative for them to invest their limited and most important resource in perfect option that could prove to beneficial for the organization in the long
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Shareholders’ Wealth Maximization Approach; Time Value of Money and Uncertainty; Agency Problem; Social Responsibility Business Environment‚ Taxes‚ and Financial Environment: Forms of Business Organizations; Financial Instruments; Money Market and Capital Market Instruments; Financial Intermediaries; Financial Risk and Return Concepts in Valuation / Time Value of Money: Present Value vs. Future Value; Simple Interest vs. Compound Interest; Annuities vs. Simple Compounding and Discounting; Future
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Each of these measures is intended to be an indicator of profit or net benefit for a project under consideration. Some of these measures indicate the size of the profit at a specific point in time; others give the rate of return per period when the capital is in use or when reinvestments of the early profits are also included. If a decision maker understands clearly the meaning of the various profit measures for a given project‚ there is no reason why one cannot use all of them for the restrictive purposes
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͵ΖΔΖΞΓΖΣ͑ ͵ΖΔΖΞΓΖΣ͑ͣͤ͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͢͡ ͣͤ͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͢͡ʹΒΤΖ͑΄ΥΦΕΪ͑΄ΖΣΚΖΤ ͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑͑ʹΒΤΖ͑΄ΥΦΕΪ͑΄ΖΣΚΖΤ Investing in a Brewpub: A Capital Budgeting Analysis ͳ Elizabeth Webb Cooper‚ Ph.D. Associate Professor of Finance La Salle University 1900 W. Olney Ave. Philadelphia‚ PA 19041 cooper@lasalle.edu Elizabeth Webb Cooper‚ La Salle University‚ cooper@lasalle.edu Case ID 041001
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|[pic] |Course Syllabus | | |School of Business | | |FIN/370 Version 7 | |
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CMA Exam Support Package Examination Essay Questions For Practice © Copyright 2010 By Institute of Certified Management Accountants Introduction The Institute of Certified Management Accountants (ICMA) is publishing this book of practice questions with answers to help you prepare for the CMA examination. Each question is referenced to the Content Specification Outline (CSO) and the Learning Outcome Statements (LOS). These questions are actual “retired” questions from the CMA exams
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Accounting Education: an international journal Vol. 15‚ No. 1‚ 3 –10‚ March 2006 Why DCF Capital Budgeting is Bad for Business and Why Business Schools Should Stop Teaching it RALPH W. ADLER University of Otago‚ New Zealand Introduction As educators‚ we are constantly making decisions about course content. Each year‚ as we begin our preparations for writing our new or updated course outlines‚ such questions as what topics to include‚ modify‚ or exclude‚ are contemplated and re-contemplated
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Governance The Developing Finance Function The Principles of Investment Perfect Markets and the Separation Theorem Summary and Conclusions Selected References PART TWO: THE INVESTMENT DECISION 2. 2.1 2.2 2.3 2.4 2.5 Capital Budgeting Under Conditions of Certainty The Role of Capital Budgeting Liquidity‚ Profitability and Present Value The Internal Rate of Return (IRR) The Inadequacies of IRR and the Case for NPV Summary and Conclusions 8 8 8 10 11 13 15 18 21 24 25 27 27 28 28 34 36 37 what‘s missing
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statement of future plans‚ usually expressed in monetary terms. 2. Continuous budgeting is the practice of preparing a new budget for a selected number of future periods and revising those budgets as each period is completed. 3. Budget preparation is best determined in a top-down managerial approach. 4. The master budget consists of three major groups of budget components: the operating budgets‚ the capital expenditures budgets‚ and the financial budgets. 5. The budget process
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27708‚ USA National Bureau of Economic Research‚ Cambridge‚ MA 02912‚ USA Received 2 August 1999; received in revised form 10 December 1999 Abstract We survey 392 CFOs about the cost of capital‚ capital budgeting‚ and capital structure. Large "rms rely heavily on present value techniques and the capital asset pricing model‚ while small "rms are relatively likely to use the payback criterion. A surprising number of "rms use "rm risk rather than project risk in evaluating new investments. Firms
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