Sfm
This query is : Resolved
ayushi gupta
(Querist)
01 July 2015
Why is apportioned cost not considered in Capital Budgeting decisions?
CA. Sunil Gokhale
(Expert)
02 July 2015
In computation of cash flows we take only the actual cash inflow or outflow. If an expense has already been incurred but is now only being apportioned to the project then there is no additional cash outflow for the project. It is just the share of expense being charged to the project. As it does not involve a cash outflow it is not taken.
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