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Alejandra Rosales
on Nov 12, 2024

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The length of time it will take to recover through cash inflows the dollars of a capital outlay

A) Capital rationing
B) Annuity
C) Capital investment analysis
D) Internal rate of return method
E) Payback period
F) Accounting rate of return

Capital Rationing

The process of selecting the most profitable projects to invest in when a company has a limited amount of capital.

Capital Outlay

Expenditures for acquiring fixed assets or adding to the value of an existing fixed asset with a useful life extending beyond the taxable year.

Cash Inflows

The total amount of money coming into a company from its operational, investing, and financial activities over a period.

  • Quantify and acknowledge the importance of the cash payback period in the evaluation of investment opportunities.
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Makenzi HayesNov 12, 2024
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