Paper , Order, or Assignment Requirements
Companies use funds to finance long term operations, it’s important to know how to evaluate future returns to determine if a project is worth pursuing.
• capital budgeting, NPV, Payback, P.I
• break-even analysis,
• estimating cash flow
• cost of capital
• long-term asset management
• depreciation, SL, Accelerated
1) Module 4: Financing Alternatives (Modules are located in LEO – Content – Course Content –click on the title of the Module and Read Commentary)
a. The Firm’s Cost of Capital- Read through Cost of Capital Debt Financing.
b. Breakeven Analysis
2) Course Text : Boundless Finance Online Text
(A PDF of the Boundless course textbook may also be found in Leo under Content > Syllabus)
• Chapter 10: Cost of Capital
• Chapter 11: Capital Budgeting
3) TeachMeFinance.com – read topics:
Cost of Capital, http://teachmefinance.com/
View: Capital Budgeting You Tube video: Capital Budgeting
• Participate in the Weekly Discussion
• Problem Set in ‘Homework’ #6 – My Tools/ Quizzes & Exams/ Finc 331 Homework Week 6
Capital budgeting is a complicated process that is essential to an organization’s making good investment decisions. Please give an example of a capital budgeting decision a company might need to make. Once a business computes its cost of capital, how does a manager decide whether to take on a project or not? What considerations might inform the decision?