Chapter 12. Examining Decision Criteria for a Business Case
Chapter 11, “Examining a Business Case: Investment,” looked at the relevant facts surrounding a business case decision. If you worked your way through the case study, you constructed a pro forma income statement and a pro forma cash flow statement. These statements help you to describe the decision quantitatively, but that’s not the end of the process.
An important criterion to use in the evaluation of an income or cash flow statement is the discount factor. The term discounting refers to the estimation of the present value of future ...
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