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Cambridge AS & A Level Accounting

4.4.1Investment appraisal

Investment appraisal in Cambridge AS & A Level Accounting: what the syllabus expects you to know, the learning objectives and how to practise.
Subtopic66 practice questions3 lessons

Overview

Questions on discounted payback and on residual values of an investment will not be set.

Learning objectives

What the syllabus expects you to be able to do.

  1. 4.4.1.1Identify the future net cash inflows and outflows of a project and apply payback, accounting rate of return, net present value and internal rate of return.
  2. 4.4.1.2Explain the advantages and disadvantages of the techniques and make investment decisions and recommendations, noting non-financial factors.

Lessons

  • Evaluating investment projects and making recommendations

    50 min

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  • Net present value and internal rate of return

    55 min

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  • Payback period and accounting rate of return

    50 min

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Sample question

A sample question on this topic. Answer it, check it, then read the worked answer.

Investment appraisal: sample question

1 mark

Which investment appraisal technique uses accounting profit rather than cash flows?

Choose one answer

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