Accounting

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Objective: Describe and evaluate capital budgeting concepts, and applications, as the foundation of making financial decisions.  Introduction: This lesson explores capital budgeting and working capital as the foundations for making informed financial decisions. Business entities, as stewards of their owners’ funds, must continually take advantage of opportunities to maximize owners’ investments. Businesses do so through the budget and capital management process. This essay will provide you with an opportunity to demonstrate your understanding of the concepts and tools in strategic budget management and the importance of capital budgeting to a business.  Deliverables: The essay for this lesson is required to be a minimum of 750 words that clearly demonstrate your understanding of the activity. Essays should have a clear introduction, thesis statement and conclusion, written in APA format (APAstyle.org). A minimum of three sources must be cited in-text and in the Reference list.   Activity Details: 


 Step 1: Read the following questions, and use what you have learned about this lesson’s objective to summarize your responses. 

•Explain why large, publicly held corporations must utilize capital budgeting. Include in your response the decision-making processes for approving a new project and choosing among alternative projects. 

•Explain “relevant cash flows” and how an investment affects a corporation’s share price. In your response, also identify the risks present when investments are made in foreign countries and how those risks can affect an investment’s value. 

•Describe the process of managing working capital. In your response, explain the effect on cash from changes in the cash cycle.  


Step 2: Write a paper. Please review the essay rubric prior to proceeding.  Use these writing guidelines: 

•Include a cover page and references in addition to your required word count. •Use correct APA format. 

•Double-space text. 

•Use size 12 Times New Roman. 

•Indent paragraphs. 

•Include in-text citations as appropriate. 

•Use correct spelling, grammar, sentence structure and verb tense. 

•Optional: Use section headings to organize.

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