12 Questions
What is a critical factor in investment decisions due to the scale and long-term nature of the consequences?
The investor's attitude to risk
What is the primary goal of the accountant in investment and project appraisal?
To gather the essential data from various sources
What is the accounting rate of return method used for?
To compare investment and project appraisal
What is the usual decision rule when using the payback method?
To accept the project with the shortest payback period
What is included in the initial cash outflow when using investment and project appraisal methods?
The purchase of physical assets or the build-up of stocks
What is the profit referred to in investment and project appraisal?
The profit generated by the investment or project
What is the primary difference between investment appraisal decisions and short-term decision making?
The time period involved
What is a key concept in investment and project appraisal techniques that arises from the longer time period involved?
The time value of money
What is one of the situations where investment and project appraisal may be used?
Cost saving through process improvement
What is a factor that influences an organisation's decision to invest?
The investor's belief in the future
What is an alternative financing option that an organisation may consider?
Leasing
What is a key consideration in investment appraisal decisions?
The future costs and revenues
Test your knowledge of the factors that influence investment decisions in diverse organisations, including forecasts, cost analysis, risk attitude, and more. This quiz covers the key considerations that inform investment choices in a business setting.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
