Everything you need to know about capital budgeting methods. Some of the capital budgeting methods are:- 1.Traditional Methods 2.Modern Methods 1. Traditional methods includes: a.Payback Period Method (PBP) and Its Variants – Post back period, Post payback profitability method, Discounted payback period b.Accounting Rate of Return Method (ARR) 2. Modern methods includes: a.Net Present Value […]
Capital Budgeting Methods
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Working Capital
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Working capital refers to short-term funds that are needed to meet operating expenses. To quote Ramamoorthy, “It refers to the funds, which a company must possess to finance its day-to-day operations”. It is concerned with the management of the firm’s current assets and current liabilities. It relates to the problems that arise in attempting to […]
Types of Working Capital
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Working capital in a business is needed because of the operating cycle. But the need for working capital does not come to an end after the cycle is completed. Since the operating cycle is a continuous process, there remains a need for continuous supply of working capital. However, the amount of working capital required is […]