管理会计 (70)管理会计.pdf

– The payback method The payback method The payback period is the time a project will take to pay back the money spent on it. It is based on expected cash flows and provides a measure of liquidity. The payback method includes normal payback period and discounted payback method. 2 Decision criteria: (1)Compare the payback period to the company’s maximum return time allowed and if the payback is quicker the project should be accepted. (2)Faced with mutually-exclusive projects choose the project with th