Week3 paper - Use of IRR%2c NPV Payback Method in evaluating Project Cash Flows - Kathy Gray - Use of IRR NPV Payback Method in evaluating Project Cash

Week3 paper - Use of IRR%2c NPV Payback Method in evaluating Project Cash Flows - Kathy Gray

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Use of IRR, NPV Payback Method in evaluating Project Cash Flows Memorandum 1 Use of Internal Rate of Return (IRR), Net Present Value (NPV), and Payback Method in evaluating Project Cash Flows Kathryn Gray FIN/571 Accounting April 3, 2017 Julio Jimenez
Use of IRR, NPV Payback Method in evaluating Project Cash Flows Memorandum 2 MEMORANDUM TO: Julio Jimenez FROM: Kathryn Gray DATE: April 3, 2017 SUBJECT: Project Recommendation based on the use of Internal Rate of Return, Net Present Value, and Payback Method in Evaluating Project Cash Flows The purpose of this memo is to explain the three methods used to make capital budgeting decisions and to determine whether the project or investment will be profitable. Common financial methods used to make investment decisions are the net present value (NPV), internal rate of return (IRR) and payback period (PB). All three approaches are explained below for your review and assessment, along with the project recommendation based on the resulting calculations using the three methods.

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