Capital Budgeting: Capital budgeting is the process of determining whether real assets (tangible assets such as machinery and equipment or intangible assets such as patents and trademarks) are worth...
Cost of Capital.
Cost of capital, i.e., interest payments and cash-flows out, impact the total cash available to invest in capital goods. For example if you borrow $100,000 to purchase a new pizza...
It is an expenditure in order to upgread or capitalize the fixed asset .this can be expressed either by extending the future expected life or by capitalizing the fixed asset cost.