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Horngren'S Financial And Managerial Accounting
Found in: Page 1463

Short Answer

List some common cash inflows from capital investments.

Investment, cash operating cost savings, and any future residual.

See the step by step solution

Step by Step Solution

Step 1: Meaning of Capital Investment

Capital investment is a sum of money that is used to assist a company in achieving its goals or obtaining long-term assets. The phrase "capital investment" is used in a commercial setting in two different ways.

Step 2: Listing common cash inflows from capital investments

A capital investment's cash inflows comprise cash income generated by the investment, cash operating cost savings, and any future residual value of the investment (asset).

Step 3: Third and the last step of high-low method is creation of equation of mixed cost

Total mixed cost = (Variable cost per unit x Number of units) +Total fixed cost

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