Discuss the process a company may use in screening and approving the capital expenditures budget. Capital expenditures budgeting is used to describe process relating to the planning and financing of capital outlays for such purpose as the purchase of new equipment and introduction of new products. Capital expenditures budget is usually screened through a capital budget committee and is approved by board of directors in a company. A decision framework is used in capital expenditures budgeting, such as the purchase of new equipment, by a company, as the following steps. 1. Determine the long-term strategic goals and objectives of the company, and determining a manufacturing strategy that will allow these goals and objectives to be achieved. 2. List all the expected benefits and costs associated with the equipment under consideration.
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This note was uploaded on 02/01/2012 for the course ACCT ACC560 taught by Professor Lorij.perez during the Spring '10 term at Strayer.