Evaluative Tools and Capital Investment
The operations management team now feels that it can effectively evaluate the cost and benefits of long- term investments in operating assets that are critical to its growth plans. To ensure consistency within the organization, the general manager asks the accounting personnel to prepare a brief set of guidelines for all capital investment decisions.
Considering yourself as the Genesis’ accountant serving the operations management team, do the following:
Create a set of capital investment guidelines for evaluating planned projects in terms of financial performance.
Provide guidelines supported by evaluative tools, such as NPV, IRR, MIRR, payback, and breakeven analysis.
Identify the most appropriate methods for comparing projects of different sizes.
Write your initial response in 4–5 paragraphs. Apply APA standards to citation of sources.