Capital Budget Definition

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Definition Of Capital Budget:

A budget used to plan major, long-term, cash-intensive projects, such as building a new plant or office building or funding long-term research.
Several financial tools can be used to evaluate potential capital budget plans, such as internal rate of return (IRR), a payback period, and a net present value analysis. See also internal rate of return.Other definition of capital budget- Plan for raising large and long-term sums for investment in plant and machinery, over a period greater than the period considered under an operating budget. Techniques such as internal rate of return, net present value, and payback period are employed in creating capital budgets.

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