2 charge opportunity cost of the land and building 3

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: . Charge opportunity cost of the land and building. 3. The salvage value at the end of the project should be included. Research and Development 1. Research and development is a sunk cost. Working Capital 1. Will additional inventories be required as volume increases? 2. Recovery of inventories at the end of the project should be included. 3. Is additional working capital required due to changes in receivables, payables, etc.? Revenue 1. Revenue forecasts assume prices (and quantities) will be unaffected by competition, a common and critical mistake. O...
View Full Document

Ask a homework question - tutors are online