Respuesta :
Capital budgeting should be purchased to support new projects and generate future cash flows.
What is Capital budgeting?
A financial management method called capital budgeting commonly referred to as an investment appraisal may make sure the project is adding the anticipated value and continuing to track its progress.
It assesses how long it will take for a project's cash flow to recover the initial capital outlay, as well as numerous other criteria including a risk assessment.
When evaluating the worth of projects or investments that call for a significant capital outlay to decide whether they are worthwhile, capital budgeting is a crucial financial management tool.
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