× Didn't find what you were looking for? Ask a question
  
  
Top Posters
Since Sunday
p
20
17
C
11
9
8
r
8
m
8
d
7
e
7
d
7
C
7
l
6
New Topic  
wrote...
Posts: 4603
Rep: 5 0
4 years ago
What conflicts can arise between using discounted cash flow methods for capital budgeting decisions and accrual accounting for performance evaluation? How can these conflicts be reduced?
Textbook 

Cost Accounting


Edition: 14th
Authors:
Read 208 times
3 Replies

Related Topics

Replies
wrote...
4 years ago
Using accrual accounting to evaluate the performance of a manager may create conflicts with using discounted cash flow (DCF) methods for capital budgeting because frequently a project using a DCF method will not report strong operating income results in the early years of the project under accrual accounting. If this is the case, a manager might be tempted not to use DCF methods even though the decisions based on them might be in the best interests of the company over the long run. The conflict can be reduced by evaluating managers on a project-by-project basis and by looking at their ability to achieve the amounts and timing of forecasted cash flows.
wrote...
4 years ago
This solved my problem perfectly, thank you for your kind input.
wrote...
4 years ago
I'm happy to help you, how luck with the others, I noticed you've posted a lot of questions.
New Topic      
This topic is not open for further replies. If you'd like to contribute to this topic, start a new thread and make reference to this one. Otherwise, contact a moderator for more options.
Explore
Post your homework questions and get free online help from our incredible volunteers.
Learn More
Improve Grades
Help Others
Save Time
Accessible 24/7
  191 People Browsing
 139 Signed Up Today
Your Opinion
What percentage of nature vs. nurture dictates human intelligence?
Votes: 82

Previous poll results: What's your favorite coffee beverage?
Related Images
 2260
 715
 37