- Published: November 15, 2022
- Updated: November 15, 2022
- University / College: The University of Queensland
- Language: English
- Downloads: 9
Capital Budgeting Case Study:
Capital budgetingis the part of the finance of the company, which reflects loss and profit of the investment capital. Capital budgeting includes a wide range of activities and purposes. First of all the finance of capital budgeting is used for the special projects provided by the government, so that these projects are important for the society and the country, so have to be done as fast as possible. Then, there are projects which are essential for the development of the company.
Every employer creates a plan which is aimed to improve the quality of work, production and services the company offers. He will surely need extra money to improve the technologies and methods of production to be able to compete on the market further. Finally, capital budgeting is supposed to help the company cope with the dramatic problems, which threaten its work and existence. If the company faces an incident, which can be harmful for its work, capital budgeting is expected to provide it with the required sum of money to restore its positions. Evidently, the company can not invest money into all the projects. If the resources of the company are limited, it should select the most important and the worthy ones for investment.
Governmental projects are privileged to be completed first. After that it is possible to fulfill projects important for self development and then, other projects. Every great company which wants to achieve success and high profits should be able to manage its finance wisely. There is always the capital for the essential purposes important for the existence of the company and there is the capital for investment which often guarantees high profit. College and university students who dream to connect their lives with business, management and economics will need to spend much time to investigate the topic on capital budgeting well.
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