South Texas College

MHSM 3335

week 11

Rationing available capital funds is often necessary. When evaluating capital expenditure budget proposals, which of the following factors may commonly be considered?

-Necessity for request

• cost of capital to the organization

-return that could be realized on alternative investments

-All of the these are correct

2. The process involved for capital expenditure funding request varies according to the organization. The process may be influenced by:

-Size

• the corporate culture

• politics

-all of these are correct

3. Which of the following calculations should be performed to obtain a “Total Variance” proof total?

4. True or False? The type of proposal affects its size and scope.

5. The capital expenditures budget usually consists of:

6. Certain types of capital expenditure proposals may sometimes be paired as either/or choices. Which of the following proposals types could easily be presented as a pair for such either/or choices?

1. 1. Acquiring new equipment

1. 2. Upgrading existing equipment

1. 3. Replacing existing equipment with new equipment

7. The information flowing from these inputs to the capital expenditure budget would generally result in: