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	<id>https://wikimd.org/index.php?action=history&amp;feed=atom&amp;title=Capital_budgeting</id>
	<title>Capital budgeting - Revision history</title>
	<link rel="self" type="application/atom+xml" href="https://wikimd.org/index.php?action=history&amp;feed=atom&amp;title=Capital_budgeting"/>
	<link rel="alternate" type="text/html" href="https://wikimd.org/index.php?title=Capital_budgeting&amp;action=history"/>
	<updated>2026-04-28T05:57:56Z</updated>
	<subtitle>Revision history for this page on the wiki</subtitle>
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	<entry>
		<id>https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6529914&amp;oldid=prev</id>
		<title>Prab at 18:24, 18 March 2025</title>
		<link rel="alternate" type="text/html" href="https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6529914&amp;oldid=prev"/>
		<updated>2025-03-18T18:24:40Z</updated>

		<summary type="html">&lt;p&gt;&lt;/p&gt;
&lt;table style=&quot;background-color: #fff; color: #202122;&quot; data-mw=&quot;interface&quot;&gt;
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				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;← Older revision&lt;/td&gt;
				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;Revision as of 18:24, 18 March 2025&lt;/td&gt;
				&lt;/tr&gt;&lt;tr&gt;&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot; id=&quot;mw-diff-left-l44&quot;&gt;Line 44:&lt;/td&gt;
&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot;&gt;Line 44:&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{No image}}&lt;/div&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{No image}}&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot; data-marker=&quot;−&quot;&gt;&lt;/td&gt;&lt;td style=&quot;color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #ffe49c; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;&lt;del style=&quot;font-weight: bold; text-decoration: none;&quot;&gt;__NOINDEX__&lt;/del&gt;&lt;/div&gt;&lt;/td&gt;&lt;td colspan=&quot;2&quot; class=&quot;diff-side-added&quot;&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;/table&gt;</summary>
		<author><name>Prab</name></author>
	</entry>
	<entry>
		<id>https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6501402&amp;oldid=prev</id>
		<title>Prab: CSV import</title>
		<link rel="alternate" type="text/html" href="https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6501402&amp;oldid=prev"/>
		<updated>2025-03-17T07:27:07Z</updated>

		<summary type="html">&lt;p&gt;CSV import&lt;/p&gt;
&lt;table style=&quot;background-color: #fff; color: #202122;&quot; data-mw=&quot;interface&quot;&gt;
				&lt;col class=&quot;diff-marker&quot; /&gt;
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				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;← Older revision&lt;/td&gt;
				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;Revision as of 07:27, 17 March 2025&lt;/td&gt;
				&lt;/tr&gt;&lt;tr&gt;&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot; id=&quot;mw-diff-left-l44&quot;&gt;Line 44:&lt;/td&gt;
&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot;&gt;Line 44:&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
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&lt;/table&gt;</summary>
		<author><name>Prab</name></author>
	</entry>
	<entry>
		<id>https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6217065&amp;oldid=prev</id>
		<title>Prab: CSV import</title>
		<link rel="alternate" type="text/html" href="https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=6217065&amp;oldid=prev"/>
		<updated>2025-02-10T09:44:45Z</updated>

		<summary type="html">&lt;p&gt;CSV import&lt;/p&gt;
&lt;table style=&quot;background-color: #fff; color: #202122;&quot; data-mw=&quot;interface&quot;&gt;
				&lt;col class=&quot;diff-marker&quot; /&gt;
				&lt;col class=&quot;diff-content&quot; /&gt;
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				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;← Older revision&lt;/td&gt;
				&lt;td colspan=&quot;2&quot; style=&quot;background-color: #fff; color: #202122; text-align: center;&quot;&gt;Revision as of 09:44, 10 February 2025&lt;/td&gt;
				&lt;/tr&gt;&lt;tr&gt;&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot; id=&quot;mw-diff-left-l43&quot;&gt;Line 43:&lt;/td&gt;
&lt;td colspan=&quot;2&quot; class=&quot;diff-lineno&quot;&gt;Line 43:&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;[[Category:Corporate finance]]&lt;/div&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;[[Category:Corporate finance]]&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot;&gt;&lt;/td&gt;&lt;td style=&quot;background-color: #f8f9fa; color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #eaecf0; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;{{finance-stub}}&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr&gt;&lt;td colspan=&quot;2&quot; class=&quot;diff-side-deleted&quot;&gt;&lt;/td&gt;&lt;td class=&quot;diff-marker&quot; data-marker=&quot;+&quot;&gt;&lt;/td&gt;&lt;td style=&quot;color: #202122; font-size: 88%; border-style: solid; border-width: 1px 1px 1px 4px; border-radius: 0.33em; border-color: #a3d3ff; vertical-align: top; white-space: pre-wrap;&quot;&gt;&lt;div&gt;&lt;ins style=&quot;font-weight: bold; text-decoration: none;&quot;&gt;{{No image}}&lt;/ins&gt;&lt;/div&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;/table&gt;</summary>
		<author><name>Prab</name></author>
	</entry>
	<entry>
		<id>https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=5354149&amp;oldid=prev</id>
		<title>Prab: CSV import</title>
		<link rel="alternate" type="text/html" href="https://wikimd.org/index.php?title=Capital_budgeting&amp;diff=5354149&amp;oldid=prev"/>
		<updated>2024-03-03T18:10:05Z</updated>

		<summary type="html">&lt;p&gt;CSV import&lt;/p&gt;
&lt;p&gt;&lt;b&gt;New page&lt;/b&gt;&lt;/p&gt;&lt;div&gt;&amp;#039;&amp;#039;&amp;#039;Capital Budgeting&amp;#039;&amp;#039;&amp;#039; is a process used by organizations to evaluate and rank potential expenditures or investments that are significant in amount. These expenditures and investments include projects such as building a new plant or investing in a long-term venture. Often, a company assesses a prospective project&amp;#039;s lifetime cash inflows and outflows to determine whether the potential returns generated meet a sufficient target benchmark.&lt;br /&gt;
&lt;br /&gt;
== Overview ==&lt;br /&gt;
&lt;br /&gt;
The primary purpose of [[capital budgeting]] is to provide a systematic method for evaluating the economic viability and impact of proposed investment projects. It is a tool to decide whether a company&amp;#039;s long-term investments such as new machinery, replacement machinery, new plants, new products, and research development projects are worth pursuing.&lt;br /&gt;
&lt;br /&gt;
== Methods of Capital Budgeting ==&lt;br /&gt;
&lt;br /&gt;
There are several methods of capital budgeting, including the [[payback period]], [[net present value]] (NPV), [[internal rate of return]] (IRR), and [[profitability index]] (PI).&lt;br /&gt;
&lt;br /&gt;
=== Payback Period ===&lt;br /&gt;
&lt;br /&gt;
The [[payback period]] is the simplest method of capital budgeting. It is the length of time it takes to recover the initial cost of an investment. The payback period is a significant factor in decision-making for companies with liquidity concerns.&lt;br /&gt;
&lt;br /&gt;
=== Net Present Value ===&lt;br /&gt;
&lt;br /&gt;
[[Net present value]] (NPV) is the difference between the present value of cash inflows and the present value of cash outflows over a period of time. NPV is used in capital budgeting and investment planning to analyze the profitability of a projected investment or project.&lt;br /&gt;
&lt;br /&gt;
=== Internal Rate of Return ===&lt;br /&gt;
&lt;br /&gt;
The [[internal rate of return]] (IRR) is a discount rate that makes the net present value (NPV) of all cash flows equal to zero in a capital budgeting scenario. IRR is used to evaluate the attractiveness of a project or investment.&lt;br /&gt;
&lt;br /&gt;
=== Profitability Index ===&lt;br /&gt;
&lt;br /&gt;
The [[profitability index]] (PI) is a technique used in capital budgeting to show the relationship between the costs and benefits of a proposed project. It is calculated by dividing the present value of future cash flows by the initial investment.&lt;br /&gt;
&lt;br /&gt;
== Limitations of Capital Budgeting ==&lt;br /&gt;
&lt;br /&gt;
While capital budgeting is a valuable tool, it has limitations. These include the difficulty of estimating future cash flows, the challenge of determining the appropriate discount rate, and the potential for conflict with short-term performance measures.&lt;br /&gt;
&lt;br /&gt;
== See Also ==&lt;br /&gt;
&lt;br /&gt;
* [[Financial management]]&lt;br /&gt;
* [[Investment appraisal]]&lt;br /&gt;
* [[Corporate finance]]&lt;br /&gt;
&lt;br /&gt;
== References ==&lt;br /&gt;
&lt;br /&gt;
{{reflist}}&lt;br /&gt;
&lt;br /&gt;
[[Category:Finance]]&lt;br /&gt;
[[Category:Investment]]&lt;br /&gt;
[[Category:Corporate finance]]&lt;br /&gt;
{{finance-stub}}&lt;/div&gt;</summary>
		<author><name>Prab</name></author>
	</entry>
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