This self-paced tutorial explains capital budgeting, valuation, net cash flows, and capital budgeting techniques.
Type of Material:
Tutorial
Recommended Uses:
Individua, In-class, homework, self-paced.
Technical Requirements:
Internet browser
Identify Major Learning Goals:
The learning goals are to 1) understand the difference between capital budgeting and capital expenditure, 2) apply capital budgeting concepts to cash flows, 3) explore the effects of taxes and depreciation on capital expenditures.
Target Student Population:
Sophomore level accounting or finance classes.
Prerequisite Knowledge or Skills:
Financial accounting, budgeting, calculator, Use of NPV factors table.
Content Quality
Rating:
Strengths:
Content is accurate, current, and relevant. The presentation can be used in several teaching and learning modes. The examples given during the tutorial do a terrific job of explaining the effects of taxes on the disposal of assets. All necessary definitions are provided. Similarly, the explanation of computing the cash flows was very good.
Concerns:
More attention could have been given to connect the concepts presented in the tutorial to capital budgeting. The different types of analysis used with capital budgeting could have been more clearly incorporated and/or labeled. Three pages of the tutorial are devoted to disposal of old assets without an explicit connection to the larger idea of capital budgeting.
Potential Effectiveness as a Teaching Tool
Rating:
Strengths:
The learning objectives are listed as bullet-type points on the beginning page of the tutorial. Ideas are reinforced with examples. This material could easily be assigned as a means of improving students’ knowledge about capital budgeting.
Concerns:
Prerequisite knowledge of accounting, finance, and budgeting is not identified. Concepts are reinforced but not linked (i.e., A connects to B, A and B connect to C, etc.). It seems as though prior concept knowledge is needed, but it is not clear what knowledge should be present.
Ease of Use for Both Students and Faculty
Rating:
Strengths:
The module is very easy to access and navigate. The information is engaging is that the computations are well explained and easy to follow. The visual elements are professionally rendered and generally appealing.
Concerns:
Besides the “Begin,” “Previous,” and “Next” buttons, no other instructions exist for navigating this tutorial. The tutorial is marginally interactive in that the user can choose to start over or go to a specific page. The material is presented in a static form and the colors used do not draw attention to specific results or steps in the capital budgeting process.
Creative Commons:
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