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

Moulding materials, The commonly used moulding materials for mould making...

The commonly used moulding materials for mould making can be broadly classified into the following two groups :             (a) Metals : Including grey cast iron, steel and an

International business, VK Ltd a multi product company, furnishes you the f...

VK Ltd a multi product company, furnishes you the following data relating to the year 2000. First half sales Second half sales Sales Rs.45000 Rs.50000 Total cost Rs.40000 Rs

Finance, et C(K) denote a European vanilla Call option with strike price K....

et C(K) denote a European vanilla Call option with strike price K. Assume that all options are identical except for strike price, and strike prices satisfy (K1) What are the no-a

Rayleigh scattering, how rayleigh scattering occurs in optical fiber cable

how rayleigh scattering occurs in optical fiber cable

Extended input facilities, Extended input facilities Another instance w...

Extended input facilities Another instance where multiple inputs to a single gate operation can occur is with certain types of gate elements that have an 'EXTENDED INPUT' facil

Define demat account?, Define Demat Account? What is the use of it? Dema...

Define Demat Account? What is the use of it? Demat indicates Dematerialization of reveal, in easy it is an consideration with which a individual can business in protection indus

Power systems, WHY VOLTAGE GENERATED IN MULTIPLES OF 11

WHY VOLTAGE GENERATED IN MULTIPLES OF 11

What is ebidta?, What Is EBIDTA?  EBITDA appears for income before atten...

What Is EBIDTA?  EBITDA appears for income before attention, taxation, devaluation, and amount. EBITDA came into large use among personal investment companies, seeking to determ

Estimate the total annual particulate matter, A concrete block manufacturer...

A concrete block manufacturer operates a natural gas-fired furnace-type curing kiln (rated at 20 Mbtu/hr) and consumes 820, 000, 000 cubic meters of fuel annually.  Being similar t

Write Your Message!

Captcha
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!

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