what is capital budgeting and techniques of capital
budgeting.

Answer Posted / saraswathi.k

It is Investment decision concerned with the allocation of
given capital to mobilise the fixed assets for the
business. The benefits from the assets are further realised
in future. Thus capital budgeting decision adds to the
total fixed assets of the conern by adopting new investment
plan prior to one year. It is the calculation of future
benefits and minimisation of risks. There are four major
capital budgeting techniques: 1)Pay back method 2) Average
rate of returnmethod 3) Internal rate of return method 4)
Net Present value method.

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