Uniform Annual Equivalent (Uae) - a Capital Budgeting Method.

Uniform Annual Equivalent (UAE) - A Capital Budgeting Method. (The evaluation of two mutually exclusive projects with varying lives requires careful examination of the existence of the reinvestment opportunities at the end of the different economic lives of the projects. The current article deals with a method that may be adopted in situations wherein the level of investments, the life of the projects and cash inflows (or outflows) are unequal.) Risk is inherent in almost every business decisions. Capital budgeting being an important financial excise, before committing funds physically, one need to look investment proposition from all possible angles. Many approaches techniques are since developed that assists a financial managers†¦show more content†¦85,417 Rs. 36,178 respectively as under: NPV Machine B = Rs.50,000 + Rs. 15,000 + Rs. 15,000 + Rs. 15,000 2 3 (1.13) (1.13) (1.13) = Rs.50,000 + Rs. 13,274 + Rs.11,747 + Rs. 10,396 = Rs.85,417. Now UAE/ANB Machine B = Rs. 85,417 = Rs. 36,178 2.361 Where UAE is determined for a machine / project with cash outflows showing (expenses as in the instant case), the machine with lower UAE needs to be opted. Where the cash flows represent cash inflows or revenues or profits generated, the machine or project with higher UAE needs to be opted. Consider the following example: Projects X Y Capital Outlay (Rs.) 88,000 105,000 Estimated Cash inflows (Rs.) 15,500 10,000 Estimated life (in years) 4 6 Rate of interest (%) 13 13 In this case the calculation needs to be done on the same line as done for machine A B. But the only difference is: the project withShow MoreRelatedNokias Human Resources System144007 Words   |  577 PagesForm 20-F 2010 Nokia Form 20-F 2010 As filed with the Securities and Exchange Commission on March 11, 2011. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20 ­F ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2010 Commission file number 1 ­13202 Nokia Corporation (Exact name of Registrant as specified in its charter) Republic of Finland (Jurisdiction of incorporation) KeilalahdentieRead MoreA Comprehensive Analysis of Hyatt Hotels Corporation and How It Relates to Competition Within the Hotel Industry27390 Words   |  110 Pagesof Starwood Hotels amp; Resorts Worldwide Inc, expects to see a rise in the rest of the world, implying that the US may no longer be the dominant leader in travel spending. Since 2000 the average annual growth rate of outbound departures from China has been over 20%, and since 2004 the equivalent rate for India has been over 16%. Establishing a presence in these markets now will not only allow hospitality groups to exploit these high growth domestic markets, but will also build brand recognition