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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Capital Budgeting
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Capital budgeting is a process which helps enterprises in examining the financial implications of the long term investment projects. The decision of accepting or rejecting an investment project as part of a company’s policy depends upon the investment rate of return that such a project will generate. Capital budgeting is the process of evaluating and […]
Capital Structure
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The term ‘Capital Structure’ refers to the proportion between the various long-term sources of finance in the total capital of the firm. The major sources of long-term finance include ‘Proprietor’s Funds’ and ‘Borrowed Funds’. “Capital structure is the makeup of a firm’s capitalization i.e. it represents the mix of different sources of long term funds […]