Capital budgeting involves ________.

Question

Quizplus · Accepted Answer

Capital budgeting involves analyzing and selecting long-term investment opportunities that involve significant outlays of cash. It is a process of evaluating the feasibility of investing in specific assets that will yield future benefits over several years. Option A is incorrect as it involves budgeting for operational expenses, which is not a part of capital budgeting. Option B is also wrong as it relates to the sales budget, which is a component of the operating budget, not the capital budget. Option D is incorrect as analyzing alternatives of financing is a part of the capital structure decision, not capital budgeting.

Capital Budgeting Involves ________