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Capital Budgeting Essays (Examples)

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Capital Budget in Recreation in
Words: 1338 Length: 5 Pages Document Type: Term Paper Paper #: 62456257
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To solve these emerging needs of the company to satisfy the demand in the market, it is necessary to invest into expanding of the services offered and shifting the existing concept of the club. Firstly, it is necessary to expand the space occupied by renting out additional premises and organizing Spa procedures there. This will require also investment into necessary human resources, such as hiring Spa administrative and consultants specialists offering services for both women and men, and for both facials and body treatment to maximize the services mix. Costs for occupying this space, purchasing necessary equipment and hiring adequate staff so can exceed the current costs by ?450,000, so this is the incremental expense from proceeding with this services expansion programs. Cost to organize the fitness and Spa cafe, which is proposed to call at EnerGi Box, will amount to another ?100,000 annually. The final improvement step is investment…


Brayley, R.E., McLean, D. (1999). Managing Financial Resources in Sport and Leisure Service Organizations, Sports Publishing.

Mitchell, D. Coles, C. (2004) Establishing a continuing business model innovation process, Journal of Business Strategy, 25 (3), pp. 39-49.

D. Mitchell, C. Coles, Establishing a continuing business model innovation process, Journal of Business Strategy, Volume 25, No. 3, 2004, pp. 39-49.

Capital Budget Processes and Techniques People Often
Words: 789 Length: 3 Pages Document Type: Essay Paper #: 5631191
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Capital Budget Processes and Techniques

People often ask what happens when there is a surplus of imports brought into the U.S. Many think that we just have more of what we brought in to be able to hang on to and sell at a later date but that is not the case. When there is a surplus of the products that have been brought in then the price of what the surplus is will drop. Unlike when there just isn't enough for the demand for the product then the price will raise. The reason that the price will drop is due to the products already have been paid for and now they are storing the products which cost money.

When the price is dropped then this allows for the product to be moved quickly and make room for more product and different kind of product. By doing this the price…

Capital Budget
Words: 720 Length: 2 Pages Document Type: Data Analysis Chapter Paper #: 35468423
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River County's Capital Budget

River County Capital Budget

Here at River County we have put together a capital budget because we are planning to make several principal achievements for the next year of business in 2012 because we believe that after further evaluation of the investments we have made in 2010 has helped us determine which items are beneficial to the company and the consumer. What we must ask ourselves at River County is "If we continue to purchase these types of items in the future, will the profit to our corporation be larger that the expenditure of the asset?" We realize that these items do vary; however, we are able to see the positives and negatives of these smaller and larger units by not only calculating the different costs and expected years of the product or asset, but to look at the company's averages, as well.

In reference to…

Capital Budget for River County Public Administration
Words: 633 Length: 2 Pages Document Type: Chapter Paper #: 45280716
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Capital Budget for iver County

In the current dynamic business environment, finance managers are continually faced with decisions on the best type on assets to invest in. County governments, for instance, have to analyze various investment decisions on behalf of the residents, and to estimate costs and benefits that are related to these decisions. According to Peterson and Fabozzi (2002), firms, as well as counties, should continually invest funds in assets in order to produce incomes and cash flows that will promote growth. In particular, capital assets like equipment, machinery and vehicles, which have a long estimated life, require thorough planning to ensure they give good returns on investment. Baker and English (2011) also state that it is imperative for finance managers to project the cost of capital expenditures to establish whether there is enough cash for asset acquisition and if not, consider alternative methods, such as leasing or renting.…


Baker, H.K. & English, P. (2011) Capital Budgeting Valuation: Financial Analysis for Today's Investment Projects. Hoboken, New Jersey: John Wiley & Sons, Inc.

Peterson, P. & Fabozzi, F.J. (2002) Capital Budgeting: Theory and Practice. New York, NY: John Wiley & Sons, Inc.

Value and Capital Budget the Reference Company
Words: 480 Length: 2 Pages Document Type: Essay Paper #: 50320652
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Value and Capital Budget

The reference company in this case is Starbucks. The company is currently trading at $53.55 (Yahoo! Finance, 2012). The five-year chart for Starbucks is as follows:

Yahoo! Finance (2012)

The company's current upward trajectory basically began when it rehired former CEO Howard Schultz to run the company again. Since that point in time, Starbucks have seen its former success rate be restored and the share price has been rising steadily (Kaplan, 2011). The improvement in the stock price has been about $10 per year and there is no reason to think that, with a strong economy this year, Starbucks will not continue to see this rate of growth. The futures price for 100 shares of Starbucks one year into the future will be around $65 * 100 = $6,500.

The stock price has been steadily improving. Although Starbucks does have higher than average volatility (beta 1.28),…

Works Cited:

Baertlein, L. (2012). Starbucks goes beyond coffee with first juice bar. Reuters. Retrieved March 20, 2012 from 

Kaplan, D. (2011). Howard Schultz brews strong coffee at Starbucks. CNN Money. Retrieved March 20, 2012 from

Yahoo! Finance. (2012). Starbucks. Yahoo!. Retrieved March 20, 2012 from

Capital Project Analysis
Words: 1319 Length: 4 Pages Document Type: Research Paper Paper #: 6992058
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Capital Project

According to the AMA, capital budgeting is "the decision-making process used by companies to evaluate long-term investments in large capital assets" (Hampton, 2011). Zeit (2013) makes the point that construction projects are included in the category of capital investment decisions, and that designers and architects are often involved. eiter et al. (2000) argue that because of their size and critical strategic nature, "capital investment decisions are among the most important decisions made by firms."

What this means is that capital projects tend to be large-scale projects that have several key characteristics. They require a lot of money, to the point where that money may need to be acquired through financing. So construction projects in particular like new buildings or new wings would qualify. There is some ambiguity in the research if a takeover or merger would qualify as a capital project when financed with cash, but a small-scale…


Cleverley, W., Song, P, & Cleverley, J. (2011). Essentials of Health Care Finance. Sudbury, MA: Jones & Bartlett Publishing.

FASB. (1985). Statement of financial accounting concepts No. 6. Financial Accounting Standards Board. Retrieved October 12, 2013 from 

Hampton, J. (2011). The AMA handbook of financial management. AMACOM. Chapter 10.

Reiter, K., Smith, D., Wheeler, J. & Rivenson, H. (2000). Capital investment strategies in health care systems. Journal of Health Care Finance. Vol. 26 (4) 31-41.

Budget Building a Profit Plan
Words: 2893 Length: 10 Pages Document Type: Term Paper Paper #: 48166924
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Operating expenses include selling and administrative expense. Ordinarily, a forecast or budget for selling expenses is prepared together with the sales budget or profit target because selling efforts such as promotions, commissions and salaries of the sales staff are directly related to sales. Selling expenses may either be variable or fixed. Administrative expenses include projected administrative costs for other than production or selling activities. These expenses are mostly composed of fixed costs such as research and development, insurance payments and government taxes.

3. Calculate expected profits

Profit is the excess of revenue over total costs and expenses incurred in generating such revenue during the period of operation. Profit can be expressed in the mathematical equation:

Profit = Sales - Total Costs and Expenses]

Costs having been considered, the budgeted profit plan may now be established. Injecting the concept of 'revenue less expenses equals profit,' the profit may be calculated as…

Budget DQ1a I Don't Need
Words: 1073 Length: 3 Pages Document Type: Thesis Paper #: 89806186
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Looking over a spreadsheet can clarify when to make larger purchases, such as waiting until the start of a new billing cycle, or negotiating better payment terms offered by suppliers and any creditors, especially when interest rates are volatile.

Once the need for a budget is established then the organization can consider what type of budget it desires. For example, with zero-based budgeting, "all expenses must be justified for each new period. Every function within an organization is analyzed for its needs and costs. Budgets are then built around what is needed for the upcoming period, regardless of whether the budget is higher or lower than the previous one" (Zero-based budgeting, 2009, Investopedia). hile it is true that zero-based budgeting is more costly than traditional cost-based budgeting, it also favors enterprises specializing in areas "that achieve direct revenues or production" in the enterprise (Zero-based budgeting, 2009, Investopedia). For larger organizations,…

Works Cited

Activity-based budgeting.. (2009). Investopedia. Retrieved February 25, 2009 at /terms/a/abb.asp' target='_blank' REL='NOFOLLOW'>

A Set of Questions Regarding Capital
Words: 583 Length: 2 Pages Document Type: Essay Paper #: 32693835
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Capital budgeting is an important process for all organizations because it gives them the means to compare different investments. For example, a manager can use capital budgeting to evaluate different proposed projects in the organization to attempt to estimate which one's will return the most value to the organization and its investors.

"When a company is looking at, for example, acquisitions of other companies, development of new lines of business or major purchases of plants or equipment, capital budgeting is the method used to determine whether one option is better than another. There are several capital budgeting methods, each with its pros and cons (Financial Web, N.d.).

There are several methods of using a capital budgeting process and each method can be more appropriate in certain situations over the others.

The misuse of capital budgeting can be extremely costly to organizations because they might devote large capital allocations to projects…


Financial Web. (N.d.). Advantages and Disadvantages of Capital Budgeting. Retrieved from Financial Web: 

Investopedia. (N.d.). Net Present Value And Internal Rate Of Return - Profitability Index. Retrieved from Investopedia: /walkthrough/corporate-finance/4/npv-irr/profitability-index.aspx

NPV Mirr IRR Cost of Capital
Words: 725 Length: 2 Pages Document Type: Essay Paper #: 76171979
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Capital Budgeting

einvestment rates are an embodied assumption in the NPV, I and MI methods because in each of those methods, the cost of capital for the company is typically used as the discount rate. The cost of capital for the company is going to be comprised of the different elements of the capital structure, but in each of those the reinvestment rate is a key factor. It is assumed that the cost of capital is the reinvestment rate under each of these methods, and this assumption introduces the potential for error.

The assumed reinvestment rate of MI is the cost of capital, but this is problematic for a couple of reasons. The first is that this does not take into account project-specific risk (Damodar, n.d.). Each project has its own risk. Thus, the reinvestment rate should not necessarily be the same rate that is used in an NPV, I…


"Chapter 10: Capital budgeting -- why it matters" (2014) Norwich University. In possession of the author.

Damodar, A. (no date) The components of risk. NYU Stern School of Business. Retrieved Jul 12, 2016 from

Capital Project Results and Acceptability of the
Words: 2613 Length: 8 Pages Document Type: Essay Paper #: 9046436
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Capital Project

esults and acceptability of the item for key stakeholders

Da Vinci is a lucrative product that has immense contributions to the delivery of health services in many health centres globally. The effectiveness of the product lies on its new entry into the modern market. Da Vinci production and use have enlightened the public and hospital fraternities on new approaches of managing surgery operations. The resultant effects that are going to be felt after using the product are more increasing and beneficial than using the old mechanisms. The innate objective of the tool will improve on delivery of surgery services in ways that are more safe, effective, and affordable to the public. Da Vinci was first introduced as a safe way of improving surgery operations in the hospitals. Moreover, the use of the product had not been made public. Now that the machine will be available in many health…


Athanasiou, T., Debas, H.T., & Darzi, A. (2009). Key topics in surgical research and methodology. Berlin: Springer.

Bahouth, M.N., Bahouth, M.N., Blum, K., & Simone, S. (2013). Transitioning into hospital-based practice: A guide for nurse practitioners and administrators. New York, NY:

Springer Pub. Co.

Gitman, L.J., & McDaniel, C.D. (2009). The future of business: The essentials. Mason, OH:

Capital Gain the Revenue Reconciliation
Words: 2401 Length: 8 Pages Document Type: Essay Paper #: 7106500
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Furthermore, capital gains normally tend to be spread across a wider income scale than many believe. According to the IRS Individual Income Tax Returns, Preliminary Data, 1992 federal income tax returns, 55% of returns claiming capital gains were from incomes of $50,000 or less, including a capital gain (Thorning, 1995). hat this information appears to come down to is that the capital gains tax affects almost everyone, which happens to affect the economy in general.

Tax Act of 2011

ith some of the huge advantages that have been back loaded, the Tax Relief Act of 2001 displays itself as more of a tax odyssey than what would be considered a tax act. The most positive of those that are called our planners really just provide estate tax repeal which is a 50/50 possibility of essentially being executed. Taxpayers and planners similarly are left with the troublesome query, "hat is the…

Works Cited

Gordon, M. (2209). Stock Market Looks More Like Face of America, Survey Says. The Associated Press Business News, 25.

John Freear and William E. Wetzel, J. (2009). Who Bankrolls High-Tech Entrepreneurs? American Council for Capital Formation Center for Policy Research,, 101.

Michael J. Graetz. (2010). Distributional Analysis of Tax Policy. Discovery and the Capitalist Process, 105-121.

Robert Gillingham, a. J. (2007). The Effect of Marginal Tax Rates on Capital Gains Revenue,. National Tax Journal, 123.

Capital Project Are Very Important
Words: 664 Length: 2 Pages Document Type: Case Study Paper #: 99324147
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The estimated total variable costs for the one-year period were $52,000.

We now use the reak-Even Analysis formula of: Q = FC / (P -- VC), to determine the basic standards for generating a profit. Inside the formula, Q stood for the quantity of service visits required to break even. While, at the same time: FC denoted the fixed cost for the project, P is the prices charged for the various services and VC is the variable cost per visit. At which point, we divided the total variable costs by: expected number of visits ($52,000 / 4000). Once this took place, we came up with a VC of $13. Entering all the values into the formula gave us a result for Q. Of 8,064. Thus, 8,064 visits are required for the hospital to break even. In order to generate any kind of operating profits, they must go beyond this number…


Merry J. McBryde-Foster (2005). Break-Even Analysis in a Nurse-Managed Center. Retrieved from:;col1 

Capital Projects. (2009). Planetmoran. Retrieved from:

Capital Resource Management Plan for
Words: 2195 Length: 8 Pages Document Type: Term Paper Paper #: 53743170
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The recapitalization of the fleet is however in need to be changed in the meaning of adding new sources of income to ensure the adequate functioning of the fleet. In this order of ideas, the following are noteworthy for consideration:

a) Attracting more sponsorships

The targets of these actions would be large corporations or other significantly wealthy institutions. On the one side, these contributors would benefit in image and reputation from the support they offered to the fire department. The improved image would materialize in increased trust from the part of community and even higher sales levels. On the other hand however, the corporations would receive tax incentives for the sponsorships meaning as such that they would once again be remunerated for their financial support. Given these two benefits, it would be rather efficient to approach corporations for sponsorships and the success rates estimated for this endeavor are high.



Work, R.O., 2005, To take and keep the lead: a naval fleet platform architecture for enduring maritime supremacy, CBA Online,  last accessed on August 24, 2010

1998, Recapitalizing the navy: a strategy for managing the infrastructure, National Academic Press, ISBN 0309063353

2010, Recapitalization, Investopedia, /terms/r/recapitalization.asp last accessed on August 24, 2010

2010, Recapitalization, Investorwords,  last accessed on August 24, 2010