Abstract
This chapter provides an overview of the capital investment appraisal. Accountants decide which capital projects to support by the means of investment appraisal techniques. Managers need to be aware of the theory to argue for expenditure on items that may not meet the prescribed cut-off point. Some machines may be cheaper to run or produce more units per hour. The decision will in fact have many aspects to be considered. Investment appraisal, an important element of accounting courses, is a fairly complex topic. As a financially aware manager, one will need to be aware of the theory and the arguments for and against the accountant's representation. If cash for equipment is scarce, then, as a departmental manager, one may have to put in bid—a case why the project should receive priority.
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