In practice, do you think YOUR firm should go to the time and expense of implementing a capital budgeting system into the planning process?

Date Submitted: 09/10/2006 01:51:17
Category: / Business & Economy / Accounting
Length: 3 pages (941 words)
"Capital budgeting ~ the process of analysing potential fixed asset investments. Capital budget decisions ~ probably the most important ones financial managers must take." (1) "Financial and budgetary accounting are branches of the same discipline, but they have fundamentally different purposes. Financial accounting looks backward in time: it summarizes economic performance for a past period. Budgetary accounting, by contrast, looks forward: it measures the cost of planned acquisitions and the use of economic resources in the future." (2) This …
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…and rates of return. For example, "balance spending with the resources available within political, economic, and legal tax and debt limits." [4] Or in simple terms keep the government happy! References 1.www.cbo.gov/showdoc.cfm?index=440 2.Financial Management, Theory and Practice, Eugene F. Brigham, Michael C. Ehrhardt, 11th Edition 3.www.info.doh.gov.uk/doh/rm5.nsf/0/824f30c511a06e8900256b1b005f9216?OpenDocument 4.Mikesell, John. 1999. Fiscal Administration, 5th ed. Fort Worth: Harcourt Brace.
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