Capital Budgeting Is A Step Process An Organization
Capital budgeting is a step by step process an organization use to evaluate the merits and
viabilities of long term investment project. The evaluation techniques used in capital budgeting
essentially center on the costs of investments relative to the benefits that will be generate from
the investment. Capital budgeting is important because its decisions impact the firm for several
years (Capital Budgeting, 2009) so, they must be carefully planned.
The VDOT, as many organizations, uses capital budgeting to enable the organization to estimate
and forecast its revenues, monitor and control expenditure, and look out for new investment
projects to plan, deliver, operate and maintain a transportation system that is safe, enables ... Show
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Richmond, 2014).
The agency s payroll increase 2 percent ($7,763,878), 4 percent ($15,527,757) or 5 percent
($19,409,696) for the year 2014 can improve employee s satisfaction and play a distinctive role,
especially at 5 percent increase, on how well employees perform. However, the increase in salaries
especially at 4 and 5 percent can greatly affect the organization budget as the agency total expenditure
is already greater that its revenue.
2014
2014 ( 2% )
2014 ( 4%)
2014 (5%)
Total Payroll
$388,193,923
$395,957,801
$403,721,680
$407,603,619
Increase
$7,763,878 $15,527,757 $19,409,696
Trend Analysis Over the past five years, the Virginia Department of Transportation has conducting
larger