Value Investment Alternatives

Question 1

Answer each question

  • Describe how net present value is used in the financial decision making process.
  • Explain the disadvantages of using the payback method.
  • Compare and contrast the internal rate of return (IRR) method from the net present value method (NPV)
  • Review the financial considerations a company should make before investing in a project.
  • Understand how net working capital, depreciation and interest influence the decision to buy or not to buy.
  • Explain how inflation and interest rates affect the capital budgeting process.
  • Describe how the options to expand or abandon a project are integrated in the capital budgeting process.
  • Explain how decision trees are used to value investment alternatives.

Question 2

You are the CFO of Miller Building Supplies. Using the financial exhibits at the end of the case study to determine the working capital required and actual level for each quarter of the year for the firm, address the following in your initial post:

  • What challenges does Miller Building Supplies face in establishing a monthly cash budget?
  • What would a cash budget provide Miller Building Supplies, if completed successfully?
  • What are some working capital options that might improve the firm’s cash position and profit?
  • How might the company’s accounts receivable choices impact the company?

Please answer the every questions as the list and the words should be within 3-4 pages in APA style.

Do not answer the questions in the file and just answer the questions in this description board.

 

 

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