The Payback Method

Подписаться 316 тыс.

Просмотров 137 тыс.

50% 1

This video explains how to use the payback rule to make decisions about whether to accept projects in corporate finance. The video uses a comprehensive example to demonstrate how to calculate the payback period and compare it to the required time frame. The video also points out some of the weaknesses of the payback method and notes that the chief advantage of the payback rule is its simplicity.
Here's how to calculate the payback period if the payback period is not an integer:
• How to Calculate the P...
-
Edspira is the creation of Michael McLaughlin, an award-winning professor who went from teenage homelessness to a PhD. Edspira’s mission is to make a high-quality business education freely available to the world.
-
SUBSCRIBE FOR A FREE 53-PAGE GUIDE TO THE FINANCIAL STATEMENTS, PLUS:
• A 23-PAGE GUIDE TO MANAGERIAL ACCOUNTING
• A 44-PAGE GUIDE TO U.S. TAXATION
• A 75-PAGE GUIDE TO FINANCIAL STATEMENT ANALYSIS
• MANY MORE FREE PDF GUIDES AND SPREADSHEETS
* eepurl.com/dIaa5z
-
SUPPORT EDSPIRA ON PATREON
* / prof_mclaughlin
-
GET CERTIFIED IN FINANCIAL STATEMENT ANALYSIS, IFRS 16, AND ASSET-LIABILITY MANAGEMENT
* edspira.thinki...
-
LISTEN TO THE SCHEME PODCAST
* Apple Podcasts: podcasts.apple...
* Spotify: open.spotify.c...
* Website: www.edspira.co...
-
GET TAX TIPS ON TIKTOK
* / prof_mclaughlin
-
ACCESS INDEX OF VIDEOS
* www.edspira.co...
-
CONNECT WITH EDSPIRA
* Facebook: / edspira
* Instagram: / edspiradotcom
* LinkedIn: / edspira
-
CONNECT WITH MICHAEL
* Twitter: / prof_mclaughlin
* LinkedIn: / prof-michael-mclaughlin
-
ABOUT EDSPIRA AND ITS CREATOR
* www.edspira.co...
* michaelmclaugh...

Опубликовано:

15 сен 2024

Ссылка:

Скачать:

Готовим ссылку...

Добавить в:

Мой плейлист

Посмотреть позже

Комментарии : 33

@iam-drake 11 месяцев назад

this simplified it for me..can you talk on pv anniuty and perpetuity as well. easy formulas and calculation.

@mbrabonza 7 лет назад

Thank you Dr. McLaughlin, so much for helping me through the remainder of this MBA degree and most importantly for your inspiring story!

@vivilin4571 8 лет назад

Thank you so much teacher! It made my CF course much easier. Am such a big fan.

@Edspira 8 лет назад

+Vivi Lin I'm glad your class went well! Thank you for the kind words, it's nice to know the videos are helpful!!

@johncameron3871 6 лет назад

Just stumbled on your videos prior to a midterm in theory of finance and i am so happy i found this. Great videos

@banks7583 5 лет назад

Your tutorials has helped me with my finance &accounting degrees..Thank you so much for your knowledge

@dollynanaa 5 лет назад

Thank you very much; really valuable tutorials and easy to understand; that is the main thing.

@jeremygailmanaois1202 6 лет назад

Thank you so much Sir. You make these concepts and formulas easy.

@u01sq7 8 лет назад

very good . But i would suggest another video associate with payback method, which gives payback period to be inbetween integer such as 2.5 or 2.6 year...

@Edspira 8 лет назад

+Wang Bo (CNMLGB) Thanks for the suggestion! I made the video you requested. Here's the link: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-iGImOv2rqHM.html

@u01sq7 8 лет назад

Education Unlocked very effective, good work!

@geetarudresh8461 8 лет назад

I 3rd of

@ashwamedhyedave235 4 года назад

Excellent job 👌👌👌

@Edspira 4 года назад

Thank you!

@a7med528 9 лет назад

Thanx sir

@Edspira 9 лет назад

+a7med528 No problem!

@rubenferreira-mj1ee Год назад

Why don’t we consider the present value in the cash inflows?

@TheLILCJ15 3 года назад

I have one questions: we assume that we will get additional 75k sales from buying new balloon, and by this method we calculated that on year 4 we will break even, but there also additional costs of exploitation the new balloon, which I assume will be deducted from the 75 sales right? which means, if with new balloon i have 5k additional cost, which means I am only getting 70k each year. Is it correct?

@remixowlz 5 лет назад

Very good explanation sir! Fantastic! I understood everything! lol you mae my lecturer look foolish XD

@Zuli55 5 лет назад

Amazing stuff, thank you! Where do you get the "r" from, in real life ?

@DibagusAryoseto 9 лет назад

i want to ask you about something sir.. if the case is i am going to invest, and then what would the best method to know whether i should accept the projects or not. is it NPV? or IRR? or payback? and why?

@Edspira 9 лет назад

NPV is the best. IRR is good but it doesn't work in certain situations. Payback Method is the worst because it doesn't take into consideration the time value of money.

@DibagusAryoseto 9 лет назад

what kind of situation would IRR be consider won't work?

@Edspira 9 лет назад

+Dibagus Aryoseto I've made videos about three different situations in which IRR won't work. Here are the links: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-_pImODcxx-g.html ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-BohOLldcoxk.html ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-Y4rDniH3Nk0.html

@DibagusAryoseto 9 лет назад

Woah great! thank you so much Education Unlocked ! now i really get it why would NPV is the best method.. i kept on thinking about that, and now i understand. so the main point is IRR only can be used IF the negatif cash flows occur before the positive cash flows. This is really helpful! thank you so much!

@Edspira 9 лет назад

+Dibagus Aryoseto Wonderful! I hope you do excellent in your courses!