Capital Budgeting
  1. Capital Budgeting: Introduction
  2. Capital Budgeting: The Importance Of Capital Budgeting
  3. Capital Budgeting: Evaluating The Desirability Of An Investment
  4. Capital Budgeting: Capital Budgeting Decision Tools
  5. Capital Budgeting: The Capital Budgeting Process At Work
  6. Capital Budgeting: Wrapping It All Up

Capital Budgeting: Introduction

All of us, at one time or another, have had to deal with either preparing or following a budget. In fact, many households manage their financial affairs through a budget. Businesses do the same thing through what is known as capital budgeting.

The process of capital budgeting is vital to any responsible, well managed business. If that business is public and owned by public shareholders, the budgeting process becomes more crucial, since shareholders can hold management accountable for accepting unprofitable projects that can have the effect of destroying shareholder value.

Capital Budgeting: The Importance Of Capital Budgeting

  1. Capital Budgeting: Introduction
  2. Capital Budgeting: The Importance Of Capital Budgeting
  3. Capital Budgeting: Evaluating The Desirability Of An Investment
  4. Capital Budgeting: Capital Budgeting Decision Tools
  5. Capital Budgeting: The Capital Budgeting Process At Work
  6. Capital Budgeting: Wrapping It All Up
RELATED TERMS
  1. Annual Budget

    Any budget that is prepared for a 12-month period. An annual ...
  2. Budget Manual

    A set of instructions used within large organizations to prepare ...
  3. Budget

    An estimation of the revenue and expenses over a specified future ...
  4. Balanced Budget

    A situation in financial planning or the budgeting process where ...
  5. Performance Budget

    A budget that reflects the input of resources and the output ...
  6. Federal Budget

    The federal budget is an itemized plan for the annual public ...
RELATED FAQS
  1. What's the difference between budgeting and financial forecasting?

    Learn about financial budgeting and financial forecasting and the main differences between the two management decision-making ... Read Answer >>
  2. How does a nation's national debt affect the budget process?

    See how the national debt has traditionally impacted, or purported to impact, the budgeting process for the U.S. federal ... Read Answer >>
  3. Why would a company choose to operate on a deficit budget in lieu of a balanced budget?

    Learn how companies can strategically use deficit budgets in the short term to get off the ground, expand and work through ... Read Answer >>
  4. Is there a difference between the cash budget and a credit budget?

    Learn more about how cash flow is detailed in cash budgets and how credit budgets work. Find out what these budgets reveal ... Read Answer >>
  5. What role do shareholders play in a capital budget?

    Learn about why shareholders play an integral role in capital budgeting and how it benefits businesses to use equity capital ... Read Answer >>
  6. Why should I bother creating a budget?

    Creating and using a budget is a valuable tool for all demographics; it's not just for those who need to closely monitor ... Read Answer >>
Hot Definitions
  1. Reverse Mortgage

    A type of mortgage in which a homeowner can borrow money against the value of his or her home. No repayment of the mortgage ...
  2. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  3. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  4. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  5. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  6. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
Trading Center