Payback period method, finance, Other Engineering

Payback period method, finance, Other Engineering

Assignment Help:

Non-discounted cash flow method,

Payback period method
In this method, time value of money is not considered. It takes into account the number of years required to recover the initial investment of a project (Harold Bierman, Seymour Smidt, 2006).
Accept Reject Rule:
Accept the project with lowest payback period.
Reject the project with highest payback period.
Merits:
1. Simple and easy to calculate
2. Less costly to use
3. Less time consuming
De-merits:
1. Time value of money is completely ignored.
2. Does not consider the cash flow generated after payback period.

Related Discussions:- Payback period method, finance

Oil tank- aircraft engine, Oil tank: The oil tank is usually mounted on...

Oil tank: The oil tank is usually mounted on the engine; it may be a separate unit or part of an external gearbox called the sump. It has provision to allow the system to be f

Mergers Acquisition Pooling of interests method, Mergers Acquisition Merge...

Mergers Acquisition Mergers and acquisitions involve complex accounting treatment a merger, defined as amalgamation in India, involves the absorption of the target company by the

Aerodynamics-influence on transition, Influence on transition Reynold...

Influence on transition Reynolds number - relates importance of viscousforces (relative to inertia) Lower Re - molecular diffusion more important; disturbances damped out

Discrete math, Need homework help

Need homework help

Techniques of capital budgeting, Techniques of capital budgeting There are ...

Techniques of capital budgeting There are a number of capital budgeting techniques used in the evaluation of a project. They are broadly classified under two categories: 1] Discoun

Permeability of moulding sand, Permeability of Moulding Sand is the proper...

Permeability of Moulding Sand is the property of the sand, which permits the gases and steam to escape through the sand mould. For this purpose, the sand must be porous. Permeabil

Fabric types - woven rovings , The terms roving and yarn are widely used. A...

The terms roving and yarn are widely used. A roving is a collection of untwisted strands wound together. A yarn is a generic term for a continuous strand of textile fibres, filamen

Aeroengines - compressible flow, All fluids are to some extent compressible...

All fluids are to some extent compressible but gases show significant changes in density if pressure and/or temperature is changed. Some gas flows can be treated as being incomp

Resolving power and rayleigh criterion of resolution, Q. Explain Rayleigh c...

Q. Explain Rayleigh criterion of resolution. What is meant by resolving power of grating? Ans. Resolving Power (i) Meaning of Resolution : The resolving power of

Corporate Finance, Will you take a timed online exam

Will you take a timed online exam

Write Your Message!

Name

Email id

Message

Verfication Code

Free Assignment Quote

Assured A++ Grade

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!

Submit Assignment

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd