Capital Budgeting Techniques and Ethics Essay
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Capital Budgeting Techniques and Ethics Essay
Capital, Budgeting, Techniques, Ethics, Essay
CAPITAL BUDGETING TECHNIQUES AND ETHICS 2Capital Budgeting Techniques and ethics
Question 1
Internal rate of return is a metric used in capital accounting; it’s typically applied when carrying down a process of scrutiny, which helps in identifying potential investment, opportunities, and profitability of a business or corporate organization. It has a discounted ratio that makes the net current value of all the net cash flow from an actual scheme equal to zero. The price of return in the market is a crucial consideration that pinpoints high profiles in the market in efforts to determine accurate, reliable, and present value of the cash flow. Alternatively, the gross current rate approach is a discounted flow method and budgeting techniques that foresee future evaluation, investment, and cash circulation.
The net present value analysis and eliminates time elements when comparing all forms of available and alternative investments. Ideally, the two approaches are used in evaluating capital expenditures. Taking the two methods into account of contrast, internal rates focused more on surpluses, and discounted rates whole net present is enshrined on average domestic rates of return. In my own opinion, the internal rate of return is a better approach. It has a high performance on the revenue value; for instance, fixed interest in bank rates assures investors of security when trading (Steven, 2018).
Question 2
Various reasons influence firms to indulge in public limelight and offer services. Nevertheless, the primary objective of a company is to maximize profit and the revenue collection of the shareholders or the entrepreneur. This objective is ethical and should be practiced with the line of duty. Ideally, rules and regulations enhance the values, integrity, and character of working personnel, which improves working relationships and increases the profit margin (Lohmann, 2019).
Question 3
Companies that have enhanced strict adherence to ethics have added advantages of realizing various benefits. Regulations and guidelines enable companies to secure a full scope of the market. It also increases the revenue share by providing a conducive working environment for all employees. It enhances planning and production techniques, which give them a competitive advantage and a lower cost of capital (Campbell, 2019).
References
Campbell, P. (2019, August 16). Discount rate formula: Calculating the discount rate [WACC & APV]. Retrieved from https://www.profitwell.com/blog/discount-rate-formula
Lohmann, J. (2019). IRR | Internal rate of return | Definition & example. Retrieved from https://investinganswers.com/dictionary/i/internal-rate-return-irr
Steven Bragg. (2018, May 9). The difference between NPV and IRR — AccountingTools. Retrieved from https://www.accountingtools.com/articles/the-difference-between-npv-and-irr.html
RUBRIC
Excellent Quality 95-100%
Introduction 45-41 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Literature Support 91-84 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Methodology 58-53 points
Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met.
Average Score 50-85%
40-38 points More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided.
83-76 points Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration.
52-49 points Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met.
Poor Quality 0-45%
37-1 points The background and/or significance are missing. No search history information is provided.
75-1 points Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration.
48-1 points There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met
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Capital Budgeting Techniques and Ethics Essay