Discounting means stating the future cash flows in present value
Budgeting is estimation of revnues and expenses of a future
Annualisation is turning percentages for periods less than a
year into annual percentages.
Capitalising meains recording an expense as a capital item.
Payback period is the period by which initial investment is
recovered in cash.
The following is the calculation of NPV:
|year||cash flow||discounting factor||cashflow *discounting factor|