why is an investment more attractive to management ifit has a shorter payback period?...

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Accounting

why is an investment more attractive to management ifit has a shorter payback period? Should this be the onlyconsideration? All things being equal, which of the methods coveredin the chapter (including the payback method) would you choose andwhy?

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There are some reasons for management to use payback period method 1 This method is easy to understand for users and also for stake holder Other methods that use discounting factor are not easily understandable to all 2 Management always wants to be risk averse Hence they want that investment should be collected fast 3 Shorter payback period is the criteria that is being used by the method of pay See Answer

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In: Accountingwhy is an investment more attractive to management ifit has a shorter payback period? Should...why is an investment more attractive to management ifit has a shorter payback period? Should this be the onlyconsideration? All things being equal, which of the methods coveredin the chapter (including the payback method) would you choose andwhy?