ASSIGNMENT 7:4

Financial Returns

Financial Returns

When making an investment in a capital expenditure projects the company analyses and calculates different aspects of the risks and returns associated with the particular capital expenditure investment. Therefore an in-depth analysis of the financial returns associated with a project provides within insight to the future outcomes of the investment and on these bases the company makes its decision of whether to invest or not. (Brigham & Ehrhardt, 2010, pp 219 - 223)

The fundamental and the most basic incentive for a company due to which it invests in a particular projects are to add value to the company ...