BUS 650 Week 5 DQ1 Factors in Capital Budgeting Decisions
A discussion-based assignment solution on factors affecting capital budgeting decisions.
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BUS 650 Week 5 DQ1Factors in Capital Budgeting DecisionsImagine you are a representative of management in the company you have selected for yourWeek Six assignment and you must make a capital budgeting decision.The decision is toimplement a new computer network system to decrease the time between customer order anddelivery. The cost will be 10% of last year’s profits. You are charged with describing theimportant considerations in the decision-making process to upper management.In yourresponse, be sure to include the following:A description of the important factors, in addition to quantitative factors, that wereconsidered when making this capital budgeting decision.An explanation of how these factors are significant to the company.A summary of how you will determine the criteria to rank capital budgeting decisionsand whether some criteria are more important than others.A calculation of the proposed return on investment based on criteria you select andjustification for that ROI.Develop a 200–250 word explanation supporting your recommendations.Tip: For help with reading an annual report access this handy guide fromMoneychimp(http://www.moneychimp.com/articles/financials/fundamentals.htm)
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