Capital Budgeting and Investment PlanningLaajuus (5 cr)

Learning objectives

The objective is to learn to make long-term financial calculations by using different techniques of investment calculation. The module includes also planning of successful financing of the investment plans and methods to analyse the cost of financing. Excel is utilized when making the calculations.

On successful completion of this course, the student is able to
• make long-term financial budgets
• calculate the cost of financing
• use capital budgeting models
• calculate the value of a company

Contents

• Planning of the financing of investment projects
• Methods to evaluate feasibility of investment plans: Accounting Rate of Return, Payback, Net Present Value, Internal Rate of Return
• Use of Excel functions in capital budgeting
• Methods to valuate businesses

Starting level and linkage with other courses

Financial Accounting has to be passed before this course

Implementation methods, demonstration and Work&Study

The learning goals of this course can be reached in the following ways:

a. Lectures and related assignments as full time studies
b. Participation in a working life project
c. Develop models to include study-time work experience in the studies

Assessing one´s own learning is a compulsory part of the course.

Assessment criteria - grade 1

When the implementation type of the course is CONTACT, ONLINE or BLENDED it is required that the student is present during those teaching hours that are marked in the study schedule. If you are absent more than 25 %, your grade will be lowered by one. If you are absent more than 50 %, the course is failed.

The student masters the essential aspects of investment calculations and related use of Excel spreadsheets with assistance. With given instructions, the student has the ability to perform basic tasks, but needs a lot of guidance.

Assessment criteria - grade 3

The student masters the essential aspects of of investment calculations and related use of Excel spreadsheets and related use of Excel spreadsheets. With given instructions, the student will be able to perform basic tasks.

Assessment criteria - grade 5

The student masters the essential aspects of investment calculations and related use of Excel spreadsheets independently. The student has the ability to apply the knowledge and skills learned in decision making demanded in management position.

Learning materials

Schmidgall, R. 2006 (or later). Hospitality Industry Managerial Accounting. Educational Institute of the American Hotel & Motel Association, USA. Chapters 13 and 10
Lecture materials in Moodle