explaining why a company may deliberately choose to restrict its capital expenditure?
ACCA Forums
FMcapital rationing
i think thats called soft rationing, where management decides to restrict expenditures due to the following reasons:
wish to concentrate on few projects (to limit risk)
unwilling to take external funds (interest, debt, etc)
willing to concentrate on strongly profitable projects
might affect going concern.
wish to concentrate on few projects (to limit risk)
unwilling to take external funds (interest, debt, etc)
willing to concentrate on strongly profitable projects
might affect going concern.
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