Professional Documents
Culture Documents
Capital Budgeting
Capital Budgeting
Internal rate
of return (%)
Profitability
Index (ratio)
𝑛
𝐶𝐹 𝑡
𝑁𝑃𝑉 = ∑
𝑡 =0 ( 1 + 𝑟 )𝑡
Machinery
(-) Govt Sub
Total cash outflow xxx
(+) Depreciation
CFAT/ After –tax operating income
Book salvage value
08/30/2023 FINANCIAL MANAGEMENT- PROF. MANISHA SANGHVI
BSV= Rs 100000
Cash SV= Rs 140000
Pay - Tax on profit (1,00,000-140000) Rs 40,000 @ tax rate