Answer to Question #270583 in Accounting for Nhlaphu

Question

With reference to financial management, write a short essay on the concept of capital budgeting as a key fundamental in respect of managers’ maximising corporate value for shareholders. Maximum 600 words and include references.

Answer 1

Capital budgeting is the process of planning and managing capital expenditures. It's the process of determining whether or not to invest money in a long-term project whose advantages will be recognized over a longer period of time than a year.Financial management might aim to maximize shareholder wealth by distributing dividends and/or increasing the market value.