im_pdf_ch12

# im_pdf_ch12 - CHAPTER 12 Planning for Capital Investments...

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12-1 CHAPTER 12 Planning for Capital Investments ASSIGNMENT CLASSIFICATION TABLE Study Objectives Questions Brief Exercises Exercises A Problems B Problems 1. Discuss capital budgeting evaluation, and explain inputs used in capital budgeting. 1 2. Describe the cash payback technique. 2, 3 1 1, 2, 7, 8 1A, 2A 1B, 2B 3. Explain the net present value method. 4, 5, 6, 7 2, 3, 4, 5 1, 2, 3, 8 1A, 2A, 3A, 4A, 5A 1B, 2B, 3B, 4B, 5B 4. Identify the challenges presented by intangible benefits in capital budgeting. 8, 9 4 4A 4B 5. Describe the profitability index. 10 5 3 3A 3B 6. Indicate the benefits of performing a post-audit. 11 6 7. Explain the internal rate of return method. 12, 13, 16 7, 8 4, 5 3A, 5A 3B, 5B 8. Describe the annual rate of return method. 3, 14, 15 9 6, 7, 8 1A, 2A 1B, 2B

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12-2 ASSIGNMENT CHARACTERISTICS TABLE Problem Number Description Difficulty Level Time Allotted (min.) 1A Compute annual rate of return, cash payback, and net present value. Moderate 30–40 2A Compute annual rate of return, cash payback, and net present value. Complex 30–40 3A Compute net present value, profitability index, and internal rate of return. Moderate 20–30 4A Compute net present value considering intangible benefits. Moderate 20–30 5A Compute net present value and internal rate of return with sensitivity analysis. Moderate 30–40 1B Compute annual rate of return, cash payback, and net present value. Moderate 30–40 2B Compute annual rate of return, cash payback, and net present value. Complex 30–40 3B Compute net present value, profitability index, and internal rate of return. Moderate 20–30 4B Compute net present value considering intangible benefits. Moderate 30–40 5B Compute net present value and internal rate of return with sensitivity analysis. Moderate 30–40
BLOOM’S TAXONOMY TABLE 12-3 Correlation Chart between Bloom’s Taxonomy, Study Objectives and End-of-Chapter Exercises and Problems Study Objective Knowledge Comprehension Application Analysis Synthesis Evaluation 1. Discuss capital budgeting evaluation, and explain inputs used in capital budgeting. Q12-1 2. Describe the cash payback technique. Q12-2 Q12-3 BE12-1 E12-7 E12-8 E12-1 E12-2 P12-1A P12-2A P12-1B P12-2B 3. Explain the net present value method. Q12-5 Q12-6 Q12-4 Q12-7 BE12-3 E12-8 BE12-4 P12-5A P12-5B BE12-2 BE12-5 E12-1 E12-2 E12-3 P12-1A P12-2A P12-3A P12-4A P12-1B P12-2B P12-3B P12-4B 4. Identify the challenges presented by intangible benefits in capital budgeting. Q12-9 Q12-8 BE12-4 P12-4A P12-4B 5. Describe the profitability index. Q12-10 BE12-5 E12-3 P12-3A P12-3B 6. Indicate the benefits of performing a post-audit. Q12-11 BE12-6 7. Explain the internal rate of return method. Q12-12 Q12-13 Q12-16 BE12-7 P12-5A P12-5B BE12-8 E12-4 E12-5 P12-3A P12-3B 8. Describe the annual rate of return method. Q12-14 Q12-15 Q12-3 BE12-9 E12-6 E12-7 E12-8 P12-1A P12-1B P12-2A P12-2B Broadening Your Perspective Real-World Focus Exploring the Web Decision Making Across the Organization All About You Managerial Analysis Decision Making Across the Organization Ethics Case Communication

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12-4 STUDY OBJECTIVES 1. DISCUSS CAPITAL BUDGETING EVALUATION, AND EXPLAIN INPUTS USED IN CAPITAL BUDGETING.
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