Capital Budget
List all of the projects that a company plans to undertake during the
next period
Capital Bugeting
The process of analyzing investment opportunities and deciding which
ones to accept
Incremental earnings
The amt by which a firm's earnings are expected to change as a resul...
✓ NI plus after-tax interest expense, equivalently after-tax EBIT
Marginal corporate tax rate
✓ The tax rate a firm will pay on an incremental dollar of pretax income
Opportunity cost
✓ The value a resource could have provided in its best alternative use
Project Externalities
✓ Indirect effects of a project that may increase or decrease the profits
of other business activities of a firm
Cannibalism
✓ When sales of a firm's new product displace sales of one of its existing
products
Sunk cost
✓ Any unrecoverable cost for which a firm is already liable
Overhead expenses
Master01 | October, 2024/2025 | Latest update
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