Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Explain Net Present Value Method?
Net Present Value (NPV) Method: - This process measures the Present value of returns per rupee invested. In this method present value of Institute of IT & Management cash outflows and cash inflows is computed and the present value of cash outflow is subtracted from the present value of cash inflows. The difference is described as NPV.
NPV= PV of Inflow - PV of Outflow
OR
NPV = [(Cash inflow in 1st year x PVF 1) + (Cash inflow in 2nd year x PVF 2) + (Cash
inflow in 3rdyear x PVF 3) +-----------(Cash inflow in nth year XPVFn)] - [Initial cash outflow X PVF 0]
PVF1 = Present Value Factor in 1st year
PVF2 = Present value factor in 2nd year and so on.
If PVF is not given, we may calculate NPV as follows:
NPV = [Cash inflow in 1st year X 1/(1+r)1 ] + [Cash inflow in 2nd year X 1/(1+r) 2] +
[Cash inflow in 3rd year X 1/(1+r)3 ] +--------[Cash inflow in nth year X 1/(1+r)n ] - [Initial Cash outflow X 1/(1+r)0]
Accept-Reject Criteria:-
Q. Distinguish between Management Accounting and Financial Management with clear mention of basis of differences. How does the traditional financial manager differ from the mode
Accounts receivable are sometimes not collected.Why do companies extend trade credit when they could insist on cash for all sales? Extending trade credit almost for all the tim
Which ratios would a banker be most interested in when considering whether to approve an application for a short-term business loan? Explain. Bankers and another lenders use li
Suppose the demand for bananas increases. Explain how the price of bananas adjusts after the increase in demand. If the demand for bananas rises, a shortage is made at the origin
Profit and Loss statement: The Profit and Loss statement is the primary measure of business performance. As the name suggests, this particular report measure whether the b
Limitations of participation: 1. Technology and organization today are so complex that specialized work roles are required making it difficult for people to participate succes
Determine the Preference Shares - Equity Instruments Sandwiched between equity share holders anddebt holders, preference share holders have promise of an assured dividend from
The drawbacks of the payback approach are as follows - Payback ignores the overall profitability of a project by ignoring post payback cash flows. In the illustration above the
applicability of operating cycle in poultry
Investment banks and securities firms Investment banks support corporations or governments in the issue of new debt or equity securities. Investment banking comprises Th
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd