Jump to content

Business Internal Assessment HL - Investment Appraisal


SHA

Recommended Posts

I am doing my business internal assessment of choosing two different machineries for a company. I am most likely doing investment appraisal but I am not sure what data i need?

- Cash flow forecast?

- Cost of the products

What else do I need? Thank you.

Link to post
Share on other sites

Well it seems like you should be using investment appraisal tools like the payback period and the average rate of return. A cash flow forecast would probably help you to work out the anticipated financial gain after buying the machinery. So to calculate this the data you'd need would definitely be how much the machinery would cost, as well as perhaps an estimation for how long it's 'life' will be, and anticipated financial gain per year/month. Maybe you could also calculate depreciation of the machineries? If so, you'd also need to know the residual value of the machinery (how much it is worth at the end of its useful life) and/or the rate of annual depreciation of the machinery. Not sure if this is what you were looking for but I hope it helps :)

  • Like 1
Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

×
×
  • Create New...