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Read attached postings using one or more of the following ways:

1) Share an insight from having read attached postings, synthesizing the information to provide new perspectives.

2) Offer and support an alternative perspective using readings from your own research.

3) Validate an idea with your own experience and additional research.

4) Make a suggestion based on additional evidence drawn from readings or after synthesizing multiple postings.

5) Expand on attached postings by providing additional insights or contrasting perspectives based on readings and evidence.


150 words for each attachment.

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A. Write an annotated bibliography of each article. Capital Budgeting Article 1: Investment Decisions: How it influence Capital Budgeting Practices. Ghumro, I. A., Lashari, A. A., Bhatti, I., & Abro, M.-R. (2019). Investment Decisions: How it influence Capital Budgeting Practices. Journal of Managerial Sciences, 13(2), 84–94. This article is an analysis of investments decisions in relation to capital budgeting practices in the manufacturing sector of Pakistan. It emphasizes the difference between financial and nonfinancial resources and how are utilized in the benefit of decision-making process into the organization’s goals. During the study and analysis, it was found that large firms use NPV and IRR as the most common technique used by managers in capital decisions while the small and medium-sized enterprises use the non-discount method due to their limited capital. Article 2: The Capital Budgeting of Corporate Social Responsibility ArticMaria-Teresa Bosch-Badia, Joan Montllor-Serrats, & Maria-Antonia Tarrazon-Rodon. (2020). The Capital Budgeting of Corporate Social Responsibility. Sustainability, 12(3542), 3542. https://doi.org/10.3390/su12093542le This article is an evaluation of how corporate social responsibility investments projects can help mitigate negative externalities generated by corporate investments. CSR projects goal is to improve corporate responsibility instead of maximizing the focus only on the creation of financial value. The analysis mentions that CSR need specific strategic planning and capital budgeting analysis that are focused on financial sustainability of the corporation, economic evaluation on the impact on corporate stakeholders and efficacy in natural or social units that will mitigate negative externalities. Article 3: Financial analysis for custom hire business of mechanical rice transplanter in Bangladesh Surajit Sarkar, Md. Samiul Basir, Muhammad Ashik E Rabbani, Md. Mosharraf Hossain, & Md. Monjurul Alam. (2020). Financial analysis for custom hire business of mechanical rice transplanter in Bangladesh. Fundamental and Applied Agriculture, 5(1), 124– 132. https://doi.org/10.5455/faa.79466 This is a study was performed to analyze the financial parameters of a mechanical rice transplanter in Bangladesh. Different factors such as, two types of mechanical rice transplanters, different cropping seasons, field capacity, NPV and IRR were evaluated as part of the analysis in this experiment. It was concluded that, rice transplanter was the more profitable option and that is more cost effective compared to the manual system process. This alternative is a great opportunity for custom hire business and entrepreneurship development. Article 4: Analysis of some economic-financial ratios to analyze the financial crisis in fivestar hotels in Barcelona and Madrid This article explains how the tourist model in Spain changed while the financial crisis and also how a luxury single hotel in the same hotel chain implemented a good strategic planning in order to improve their financial ratios. During this study it was found that it not worth for hotel chains to have more than one luxury hotel in the same city since at least one will show financial losses. Moreover, is important to have a good budget and planning strategy in order to accomplish maximum efficiency. Laia Pie, Isaac Bonillo, Judit Barcelo, & Laura Fabregat-Aibar. (2019). Analysis of some economic-financial ratios to analyse the financial crisis in five-star hotels in Barcelona and Madrid. Intangible Capital, 15(2), 99–113. https://doi.org/10.3926/ic.1361 B. Based on the articles you reviewed, discuss what you learned After reading both articles on capital budgeting I learned that large and medium size firms have their own common preferred methods. However, it depends on each company and their management team on which method will better fit their business needs. Moreover, I learned that non- discount method of capital budgeting does not consider the time value of money. On the other hand, there are CSR projects that their main focus is to create sustainability and not just financial value. These projects provide an integrative perspective of how corporations can accomplish financial sustainability and at the same time accomplish their organizational goals. In regard to financial analysis, I learned that there are many factors that can be considered while searching for new business opportunities and accomplish the most cost-effective method. Financial analysis is an essential tool for future business decisions and can also help investors to make the most convenient investment decision. In addition, business owners must focus not only on financial analysis but also count with a strategic and budget strategy, since this will allow them to have a better control of the business performance. C. In addition, discuss how a manager would use the concepts in the articles you reviewed in managerial decisions. Capital budgeting is an essential concept used by managers since this will allow them to provide a forecast of all revenues and expenditures of the company’s future outcome and performance. Moreover, capital budgeting help management in the decision-making process around large investments, risk, cash flow and business strategy. Financial analysis is another essential tool not only for managers but also for business owners. This method will allow management to develop efficient strategies and identify their areas of growth, strengths and weakness as well as the company performance and enhance the organization’s decision-making process. References Ghumro, I. A., Lashari, A. A., Bhatti, I., & Abro, M.-R. (2019). Investment Decisions: How it influence Capital Budgeting Practices. Journal of Managerial Sciences, 13(2), 84–94. ArticMaria-Teresa Bosch-Badia, Joan Montllor-Serrats, & Maria-Antonia Tarrazon-Rodon. (2020). The Capital Budgeting of Corporate Social Responsibility. Sustainability, 12(3542), 3542. https://doi.org/10.3390/su12093542le Surajit Sarkar, Md. Samiul Basir, Muhammad Ashik E Rabbani, Md. Mosharraf Hossain, & Md. Monjurul Alam. (2020). Financial analysis for custom hire business of mechanical rice transplanter in Bangladesh. Fundamental and Applied Agriculture, 5(1), 124– 132. https://doi.org/10.5455/faa.79466 Laia Pie, Isaac Bonillo, Judit Barcelo, & Laura Fabregat-Aibar. (2019). Analysis of some economic-financial ratios to analyse the financial crisis in five-star hotels in Barcelona and Madrid. Intangible Capital, 15(2), 99–113. https://doi.org/10.3926/ic.1361 Kengatharan, L., (2016). Capital budgeting theory and practice: a review and agenda for future research. Applied Economics and Finance, 3(2), 15-38. The author discusses the capital budgeting theory and practice. Capital budgeting basic principle advocates in employing DCF strategies and not DFC strategies to create capital budgeting decision. On the other hand, all a lot of each of the organizations in developed and acquiring places prepared to utilize complex capital budgeting strategies down with many capital budgeting tools for including possibility (i.e., awareness analysis, options) and complex reduced rate. Capital budgeting will be essential and made use of almost everywhere since an instrument for arranging, manage, and portion regarding turn sources among rivaling demands. Capital budgeting is a vital element in financial arranging and making decisions considering capital budgeting tools potential customers superior making decisions and be able to make a case for the choice of distinct capital investments among rivaling choices. Lunkes, R. J., Ripoll-Feliu, V., Giner-Fillol, A., & da Rosa, F. S. (2015). Capital budgeting practices: A comparative study between a port company in Brazil and Spain. Journal of Public Administration and Policy Research, 7(3), 39-49. The author states that capital budgeting is particles making setting up decisions for long-term investments. We have an amount of technique employed to review capital budgeting assignments, i.e., payback, bookkeeping pace associated with the return, present internet value, and interior pace of return, and earnings index. Previously 60 decades NPV and IRR emerged coming from obscurity to become among the overwhelming choices for a quantitative measurement associated with purchases' attraction throughout modern day businesses. Nuhu, M. (2014). Role of ratio analysis in business decisions: A case study NBC Maiduguri Plant. Journal of Educational and Social Research, 4(5), 105. According to Nuhu (2018), financial statements carry lots of financial Information that are hidden in the figures. The figures in financial statements become more useful when they are related to each other or some other relevant financial data. Therefore, users of financial information go a further step to establish relationships (or ratios) among selected data in financial statements. Accounting ratio is a proportion or fraction or percentage expressing the relationship between one item in a set of financial statements and another item in the financial statements. Accounting ratios are the most powerful of all tools used in analyzed and interpreting financial statements. Therefore, ratio analysis involves taking stats of number (or items) out of financial statements and forming ratios with them, to enhance informed judgments and decisions. Ravinder, D. D., & Anitha, M. (2013). Financial Analysis – A Study. Journal of Economics and Finance, 2(3), 10-22. According to Ravinder and Anitha, (2013), financial analysis can be the whole process of determining the financial muscle and weak spots in the corporation through properly building marriage amongst items of financial statements. The financial statement can be a great series of info in line with the plausible and conceptual framework — regular sales procedure. Its reason can be to convey a comprehension of several financial aspects of a company firm. It may well exhibit a situation from a short time of one's since the occasion, since regarding money statement. Financial effectiveness is the term for the action of undertaking financial activity. In a much wider perception, financial effectiveness is the education to which financial objectivities remaining and continues to be accomplished. It is the whole process of computing the final results of the firm's plans and operations inside economical terms. It is used to assess corporations over everything financial well-being over a supplied period. I learned about the capital budgeting and financial analysis based on the review of the article. Financial analysis is the whole process of analyzing enterprises, assignments, finances, and finance-related businesses to figure out his or her functionality and suitability. Commonly, financial analysis is used to examine whether a great entity is dependable, synthetic cleaning agent, fruit juice, and successful ample to cause a financial investment. As a manager could also use these concepts in the managerial decision. The capital budgeting is crucial in accepting or rejecting the project. Capital budgeting is critical because celebrate obligation and measurability. Any company this looks for to pay the resources in a project, without having comprehension the health risks and dividends involved, would be held while irresponsible by the proprietors or perhaps shareholders. Additionally, if an organization has got no chance regarding gauging the strength of the investment decisions, it is that the business enterprise could havea minor probability of moving into the cut-throat market. References Kengatharan, L. (2016). Capital budgeting theory and practice: a review and agenda for future research. Applied Economics and Finance, 3(2), 15-38. Lunkes, R. J., Ripoll-Feliu, V., Giner-Fillol, A., & Rosa, F. S. (2015). Capital budgeting practices: A comparative study between a port company in Brazil and in Spain. Journal of Public Administration and Policy Research, 7(3), 39-49. Nuhu, M. (2014). Role of ratio analysis in business decisions: A case study NBC Maiduguri Plant. Journal of Educational and Social Research, 4(5), 105. Ravinder, D. D., & Anitha, M. (2013). Financial Analysis – A Study. Journal of Economics and Finance, 2(3), 10-22. Capital Budgeting and Financial Analysis The term capital budgeting consists of two words like capital and budgeting. The word capital in this process refers to the expenditures of the company to buy some equipment, assets etc. There are some objectives of the capital budgeting process which are to be kept in the minds of managers of every company in order to gain profit. The first objective is selecting proper profitable project among many offered profitable projects based on the available capital. The other objective is to control the investment of capital. Management of the capital expenditure is very important in this process of capital budgeting. The third objective of this process is to find the appropriate source of fund. There should always be a balance between the amount of borrowing and the return of the investment (Selvanayaki, 2016). Financial analysis is a process which analyses the performance of the company using its financial data and suggests some tips for the growth of the company. This process is carried out by analysing the financial data using the spreadsheet. There are many types of financial analysis. The first type is a vertical analysis which looks at all the components of the income and divides them to express them in the percentage. This type is used to compare the company with other competitive companies. The second type is horizontal analysis takes the financial data of the company from many years and compares the data with the data of every year to check the percentage of the financial growth. The third type is leverage analysis which is used to evaluate the performance of the company. Capital budgeting helps in different ways for the growth of the company. There are many methods in this process of capital budgeting. The first method is to pay back period method. This is the period between the assumptions of gaining the profits to recover from the first investment. This method is based on the capacity of the company to gain profits. The second method is the accounting rate of return method in which the percentage of the earnings from an investment project is expressed (Simkins, 2011). Financial analysis process helps the managers of the company to evaluate the performance of the company. This financial analysis process involves some evaluations like cost volume profit analysis which helps the managers of the company to know the accurate costs of the products, the volume of the manufactured products and the profit which can be gained after selling the manufactured products. The other evaluation analysis is contribution margin which allows the managers to calculate the percentage of cash that was remained after the investment (Srithongrung, 2018). References Selvanayaki, S., Sivakumar, S. D., Rohini, A., & Mani, K. (2016). Financial Management Practices and Profitability of Modern Rice Milling Firms in Kangayam Cluster, Tamil Nadu. Agricultural Economics Research Review, 29(2), 297– 306. https://doi.org/10.5958/0974-0279.2016.00057.4 Simkins, B. J. (2011). Total Risk Evaluation for Capital Budgeting. Journal of Applied Finance, 21(1), 30–38. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&AuthType=sso&db=buh&AN= 60804487 Srithongrung, A. (2018). Capital Budgeting and Management Practices: Smoothing Out Rough Spots in Government Outlays. Public Budgeting & Finance, 38(1), 47– 71. https://doi.org/10.1111/pbaf.12167
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In support of your understanding of capital budgeting, small firms tend to prefer the nondiscounted capital budgeting methods, unlike the large firms which prefer NPV and IRR because
they have limited capital. One of the drawbacks of capital budgeting is the failure to focus on
the non-financial aspects of the projects (Bierman & Smidt, 2012). However, CSR in capital
budgeting can shed some light in that area by helping mitigate the negative effects that stem from
some corporate investments made since they improve corporate responsibility instead of only
focusing on creating financial value Regarding the financial analysis part of your post, it is...


Anonymous
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