In: Accounting
A business decision is not an easy task. It requires a careful and cautios analysis of all the aspects of the business for delivering a fruitful business decision.
The most relaevant information for any business decision are as
follows-
1. Historical
information-
If the decision is already made and implemented in the past, then
we should analyse whether such decision was a success or failure in
the past. If the decision is not made by the entity till date, then
we should analyse whether such decision made by any other firm in
the same industry was successful or not.
2. Industry and
market information
Before making any business decision, the entity must collate all
the information from the industry and market in which it is
operating. Whether the product or service it is going to deal in
the future, will be in huge demand.
3. NPV
Analysis
NPV analysis is the net present value of all future cash inflows as
reduced by future cash outflows. If the NPV is positive, it is good
sign for accepting the business decision and vice-versa.
4. CVP and Income
Analysis
Whether the cost which is incurred is able to provide the expected
volume of production and the amount of income it is generating is
sufficient to meet the objectives of the business decision.
5.
Personnel
The human resource is one of the major component of any business
entity. The ability of these resources to adapt for a change and
there acceptance is most relevant for implementing a business
decision and making it a successful one.