Capital budgeting project Essay Example | Topics and Well Written Essays - 1250 words

Capital budgeting project - Essay Example The given project was related to design and estimate the capital budget of Wright Dive Shop, the shop aimed to expand its operations by purchasing a new Air Compressor. The first step of designing the capital budget was to estimate the cash flows of the project, the acceptance and the rejection of the project depends on the analysis of these cash flows. Latterly the strength was judged by using the Payback Period, Net Present Value of the project and the Internal Rate of Return. These three processes are considered to be the capital budgeting rules that help to estimate the strength of the project. The process of Capital Budgeting was used to determine the cash flows of the purchase. The Initial investment was calculated by adding the purchase price and the investment made to increase the working capital of the business operations. The total initial investment was 425,000 (including the purchase price i.e. 325,000 and the investment in Net Working Capital i.e. 100,000). The depreciation value was identified by using the MACRS- 10 years table (7 year’s values were used). The assumptions were provided in the case and these assumptions were applied to the labor and gas costs. The labor costs were assumed to increase by 3% till the 3 year, the 4th year increment was 5 % and 7% increment was estimated for the 5th, 6th and 7th year. The Gas costs were assumed to fluctuate at 7% every year till the year 4 and after that the value of increased to 9%. The cash outflows were subtracted from the cash inflows and hence the net cash flows were extracted after deducting the variable and fixed costs and adding back the depreciation of the compressor as it is a non cash item. The cash flows were then used to identify the strength of the investment opportunity. The payback period was used to identify the number of years in which the project was assumed to pay off the initial investment. The total initial investment was

Suggestions of Crisis Communication for the Chinese Government Literature review

Suggestions of Crisis Communication for the Chinese Government - Literature review Example In short, a threat, surprise, unpredictability, short duration of response and inevitability define crises. Among all crises, damages, reputation and image are of key concern to any leader and organization during the crisis and post crisis. Arnold (2008) argues that reputational damage is an emergent danger during any crisis. Chen (2008) cites image as a central concept to the disciplines of human relations, fundamental to organizations (such as, government bodies, corporations, nonprofit groups and government institutions) as well as individuals. When a crisis erupts, the organization’s image is damaged and its capacity to manage the crisis qualities are put to test (Becker 2011). Coombs (2012) argues that crisis management is aimed at reducing or warding off financial and reputational risks by espousing the development of policies to help in the handling communication crises. A bank for crisis management policies seeks to help reduce potential negative outcomes ascribed to emergent situations and, thereby, protect institutions, stake holders and the industry from damage, According to Coombs (2012), an active crisis management platform originates from a universal â€Å"range of crisis communication approaches† comprising of a variety of activities from â€Å"denial to accommodation†. Defensive approaches assert that no disaster exists, or try to evade accountabilities for the crisis, through comprise, denial, excuses, justifications and attacks targeted at the accuser.