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Unformatted text preview: Internal rate of return (IRR) method A method used in capital budgeting that result in finding the interest yield of the potential investment Net present value (NPV) The difference that results when the original capital outlay is subtracted from the discounted net cash flows Net present value (NPV) method A method used in capital budgeting in which net cash flows are discounted to their present value and then compared to the capital outlay required by the investment Post-audit A thorough evaluation of how well a projects actual performance matches the projections made when the project was proposed Profitability index A method of comparing alternative projects that takes into account both the size of the investment and its discounted future net cash flow. It is computed by dividing the present value of net future cash flows by the initial investment....
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- Spring '09