Sunk costs influence capital budgeting decisions only when the sunk costs exceed future cash inflows. TRUE
Capital budgeting is the procedure a enterprise undertakes to assess ability foremost initiatives or investments. production of a brand new plant or a massive investment in an out of doors challenge are examples of initiatives that would require capital budgeting earlier than they're authorised or rejected.
Capital budgeting makes choices approximately the long-term funding of a company's capital into operations. making plans the eventual returns on investments in equipment, real estate and new generation are all examples of capital budgeting.
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