Question 1 (Capital Investment Appraisal):
(B) By Using results for all four methods of investment appraisal, write a report to the directors to advise them which project they should opt for, on the basis of quantitative information. There are different levels of it in each of them.
The first project (A) the result was as following:
• PBP = 6 years and 10.3 months
• ARR = 16.3 %
• NPV = RO. 65921
• IRR = 8.2 %
While the second project (B) the result was as following:
• PBP = 7 years and 10.2 months
• ARR = 13.3 %
• NPV = RO. 26991
• IRR = 5.1 %
And the last project (C) the result was as following:
• PBP = 10.9 years and 6.91 months
• ARR = 14.4 %
• NPV = RO. 198221
• IRR = 7.5 % Relevant issues include:
• The payback for project(A) is …show more content…
The organization must carefully analyze the financial evaluation techniques for assessing the feasibility of the project. We must take into account, such as regulatory, political, legal, social, environmental, cultural, organizational, administrative and other aspects of your work, such as strategic human resources, to carry out the evaluation of successful projects.
1. Operational necessity: the operating necessity:
This means the urgent and necessary need to establish a project. Such as the need to build a fence in the event of floods affecting the organization and in this case, requires the work of this fence as an operational necessity.
2. Competitive necessity
The establishment and establishment of the enterprise for the purpose of achieving a competitive advantage for the organization may be directed towards other competitors in the market.
3. Expansion of production capacity:
A project is needed to increase the organization's production capacity to meet unanticipated demands from customers on a particular product.
4. Model operational …show more content…
So, the organization must be set up an arrangement to by what method can lessen the quantities of breakdowns of the pumps and that it will be by give it a reasonable course of an activity which is most fitting for the organization and proposed as taking
(B) By Using results for all four methods of investment appraisal, write a report to the directors to advise them which project they should opt for, on the basis of quantitative information. There are different levels of it in each of them.
The first project (A) the result was as following:
• PBP = 6 years and 10.3 months
• ARR = 16.3 %
• NPV = RO. 65921
• IRR = 8.2 %
While the second project (B) the result was as following:
• PBP = 7 years and 10.2 months
• ARR = 13.3 %
• NPV = RO. 26991
• IRR = 5.1 %
And the last project (C) the result was as following:
• PBP = 10.9 years and 6.91 months
• ARR = 14.4 %
• NPV = RO. 198221
• IRR = 7.5 % Relevant issues include:
• The payback for project(A) is …show more content…
The organization must carefully analyze the financial evaluation techniques for assessing the feasibility of the project. We must take into account, such as regulatory, political, legal, social, environmental, cultural, organizational, administrative and other aspects of your work, such as strategic human resources, to carry out the evaluation of successful projects.
1. Operational necessity: the operating necessity:
This means the urgent and necessary need to establish a project. Such as the need to build a fence in the event of floods affecting the organization and in this case, requires the work of this fence as an operational necessity.
2. Competitive necessity
The establishment and establishment of the enterprise for the purpose of achieving a competitive advantage for the organization may be directed towards other competitors in the market.
3. Expansion of production capacity:
A project is needed to increase the organization's production capacity to meet unanticipated demands from customers on a particular product.
4. Model operational …show more content…
So, the organization must be set up an arrangement to by what method can lessen the quantities of breakdowns of the pumps and that it will be by give it a reasonable course of an activity which is most fitting for the organization and proposed as taking