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

Aviation legislation - air operator''s certificate (aoc), Air Operator's Ce...

Air Operator's Certificate (AOC) A Company operating an aircraft for the purpose of Public Transportation, within the UK, must have an AOC granted to the company, in accordance

Maximum speed-procraft, Maximum speed -Pro craft The standard approach f...

Maximum speed -Pro craft The standard approach for prop-driven aircraft is to assume that engine and propeller together produce a power (as opposed to thrust) output that is ind

Genetics, what is genetic engineering

what is genetic engineering

Interest rate calculations, Interest Rate Calculations In considering ...

Interest Rate Calculations In considering the time value of money, it is convenient to represent mathematically the relationship between the current or present value of a sing

Propeller pitch control, Propeller pitch control: Before looking at pro...

Propeller pitch control: Before looking at propeller pitch control an understanding of the relationship between the 'Power Lever' and the 'RPM (condition / speed) Lever' with r

Skeleton pattern, A half skeleton pattern for a hollow pipe is shown. Since...

A half skeleton pattern for a hollow pipe is shown. Since the pipe is symmetrical about the pouring line, the same pattern will serve the purpose of moulding both the halves in two

Capital Budgeting Project.., Assignment: You are interested in proposing a ...

Assignment: You are interested in proposing a new venture to the management of your company. Pertinent financial information is given below. BALANCE SHEET Cash 2,000,000 Accounts

Static electricity in aircraft, Static electricity in aircraft: As ment...

Static electricity in aircraft: As mentioned earlier, the effects of static electricity are of considerable importance in the design of aircraft and aircraft equipment. An air

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