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  2. Capital expenditure - Wikipedia

    en.wikipedia.org/wiki/Capital_expenditure

    Capital expenditures are the funds used to acquire or upgrade a company's fixed assets, such as expenditures towards property, plant, or equipment (PP&E). [3] In the case when a capital expenditure constitutes a major financial decision for a company, the expenditure must be formalized at an annual shareholders meeting or a special meeting of the Board of Directors.

  3. Capital budgeting - Wikipedia

    en.wikipedia.org/wiki/Capital_budgeting

    Capital budgeting in corporate finance, corporate planning and accounting is an area of capital management that concerns the planning process used to determine whether an organization's long term capital investments such as new machinery, replacement of machinery, new plants, new products, and research development projects are worth the funding of cash through the firm's capitalization ...

  4. Free cash flow - Wikipedia

    en.wikipedia.org/wiki/Free_cash_flow

    In financial accounting, free cash flow (FCF) or free cash flow to firm (FCFF) is the amount by which a business's operating cash flow exceeds its working capital needs and expenditures on fixed assets (known as capital expenditures). [1]

  5. Equivalent annual cost - Wikipedia

    en.wikipedia.org/wiki/Equivalent_annual_cost

    A = Capital recovery (amortization) factor F = Sinking fund amortization factor I = Investment S = Estimated salvage value = Operating expense stream d = CCA rate per year for tax purposes t = rate of taxation n = number of years i = cost of capital, rate of interest, or minimum rate of return (whichever is most relevant) and where

  6. Corporate finance - Wikipedia

    en.wikipedia.org/wiki/Corporate_finance

    The process of allocating financial resources to major investment- or capital expenditure is known as capital budgeting. [ 37 ] [ 23 ] Consistent with the overall goal of increasing firm value , the decisioning here focuses on whether the investment in question is worthy of funding through the firm's capitalization structures (debt, equity or ...

  7. What Is Depreciation? Importance and Calculation Methods ...

    www.aol.com/finance/depreciation-importance...

    Importance and Calculation Methods Explained. Allison Hache. November 12, 2024 at 5:26 PM. ... Capital gains: You pay capital gains taxes on the profit you make on the sale. This is typically at a ...

  8. Free cash flow to equity - Wikipedia

    en.wikipedia.org/wiki/Free_cash_flow_to_equity

    Free cash flow to firm (FCFF) is the cash flow available to all the firm's providers of capital once the firm pays all operating expenses (including taxes) and expenditures needed to support the firm's productive capacity. The providers of capital include common stockholders, bondholders, preferred stockholders, and other claimholders.

  9. Payback period - Wikipedia

    en.wikipedia.org/wiki/Payback_period

    Payback also ignores the cash flows beyond the payback period. Most major capital expenditures have a long life span and continue to provide cash flows even after the payback period. Since the payback period focuses on short term profitability, a valuable project may be overlooked if the payback period is the only consideration.