What are the shortcomings of the payback period?

Q: payback period?

A: Payback period is when the initial cash outflow is recovered via cash inflows

Q: What happens if the payback period is within the acceptable range?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: What is the Tolerable Rate?

A:

Q: state the limitations of the payback pe

A: Answer : The payback period is the quantity of time needed for cash inflows generated by a project…

Q: What causes the marginal rate of return to change over time?

A: Introduction: Marginal rate of return can be defined as the return attained or earned by holding a…

Q: Explain payback period

A: Answer: Payback period is nothing but the time a company gets back the money that is originally…

Q: Give an example of an irrelevant future cost. Why is it irrelevant?

A:

Q: What three flaws does the regular payback have? Does the discounted payback correctall of these…

A: Three flaws of payback period: 1. Time value of money concept is ignored by the payback period. 2.…

Q: What is the principal objection to the payback method?

A: The Payback period is one of the traditional or non-discounting techniques of Capital budgeting. It…

Q: What are the shortcomings of the payback period criterion? Which of these shortcomings are accounted…

A: Payback method is a manner of evaluating capital projects which computes the time taken by the cash…

Q: Describe the strengths and weakness of payback method.

A: Definition:   Payback method: Payback method refers to the method which measures the time period…

Q: What is the discounted-payback method?

A: Payback period states the number of years that is taken by the project to recover the investment of…

Q: explain why payback period is not a preferred method

A: The payback period is a period in which the total costs of an investment are recovered through cash…

Q: What is the payback method? What are its main strengths and weaknesses?

A: Explain the meaning of the payback method.   The payback period is the expected time period which is…

Q: What is the project's discounted payback?

A: Investment appraisal techniques are used while investing in any project. These techniques tell us…

Q: What discount rate is used in a lessor’s NPV analysis?

A: Weighted average cost of capital is used as discount rate in Lessor's NPV analysis.

Q: What is meant by the term payback period? How is the payback period determined? How can the payback…

A: Meaning: The payback period is the time required to earn back the amount invested in a particular…

Q: Define payback period.

A: Capital investment analysis: Capital investment analysis is the process of decision making, planning…

Q: What is the simple payback period for the wingtips? What is the discounted payback period?

A: The payback period refers to the time consumed to recover the cost which is incurred on investment…

Q: Define the term Discounted-Payback Period?

A: The payback period states the number of years that is taken by the project to recover the investment…

Q: what is payback period

A: Capital Budgeting: It is the planning process used to determine whether an organization invests in a…

Q: List the advantages and disadvantages of the payback method.

A: Payback method is a capital budgeting method which helps to evaluate an investment based on the time…

Q: O Payback does not consider the time value of money

A: Capital projects refer to a project which is helpful in maintaining and improving the asset of the…

Q: What is the payback screening?

A: Payback method: Payback period is the expected time period which is required to recover the cost of…

Q: Explain the payback period model and its two significant weaknesses. How does the discounted payback…

A: The payback period one of  the method of capital budgeting. It shows the required time taken to…

Q: What makes the risk-adjusted discount rate approach appealing in practical application?

A: Answer: The discount rate may be changed to offset the risk involved in a project in order to…

Q: What is the decision rule for payback?

A: Payback period is the period of time taken by the project to recover the investment in such project…

Q: What is the conventional-payback method?

A: Conventional Payback Method

Q: What is the process of consideration of the payback period?

A: Payback period It computes the required time to recover back the project’s investment by way of…

Q: What are some criticisms of the payback method?

A: Payback Period: Payback period is the period in which the project recovers its initial cost of the…

Q: explain the disadvantages of each criteria; payback period, discounted payback, NPV, IR

A: To determine the economic feasibility of capital investment, several capital budgeting analysis…

Q: What formula do you use to calculate the payback period?

A: Capital budgeting is a process to determine the worth of the project in which the company wants to…

Q: Why Pay back period method is not as effective as NPV?

A: Payback method  It doesn't consider account inflation as well as the cost of capital. It ignores…

Q: How is the payback period is calculated?

A: Payback period is the amount or length of time taken by an investment to recover its cost.

Q: What is the machine's payback period?

A: Payback period=Last period with a negative cumulative cash flow+(Absolute value of cumulative cash…

Q: What are the weaknesses of the payback method?  What other options do you have?

A: Pay back period is period required to recover initial amount of investment.

Q: Briefly explain the problems associated with the payback method.

A: Capital budgeting is referred as the process of decision making which is used by companies to…

Q: What is the discounted payback period?

A: Discounted payback period is period for which present value of cash flow is equivalent to initial…

Q: Why do some people say that MIRR should stand for Meaningless Internal Rate of Return?

A: Question is based on the concept of Business Finance

Q: What is meant by the term payback period?

A: The Payback Period helps to determine the extent of time required to recoup the initial cash outlay…

Q: What is the difference between the regularand discounted payback periods?

A: The Regular Payback period is one of the capital budgeting techniques. It refers to the time period…

Q: What is the cost of accrued liabilities? If accruals have such a low cost, why don’tfirms use them…

A: An accrued liability refers to an expense a business has incurred during a specific period but has…

Q: What are the weaknesses of the payback method?

A: Payback period is the amount of time required for firm to recover its initial investment in projects…

Q: Disadvantage of payback

A: Disadvantages of payback 1. Payback doesn't provide benefit in amount from the project it only…

Q: What are the two main drawbacks of the payback method?

A: Payback period is the method in capital budgeting which refers to the time needed to recoup the…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.