C HAP TE R 1 3 Capital investment decisions Teaching tips and points to stress Discounted cash-flow (DCF) methods Students who rely solely on pre-programmed calculators to calculate present and future value are unlikely to internalise the concepts. It is helpful for students to walk through the present- value tables (Appendix B to the text. To show the impact of interest, use a high interest rate and along time span. Urge students to begin DCF analysis by drawing a timeline of the cash inflows and outflows. Emphasise that this timeline includes only actual cash Euros coming in and going out of the organisation. For example, the cost of anew machine is a cash outflow at time zero when it is purchased. This contrasts with the accrual accounting system that records an asset at time zero that gradually becomes depreciated expense over its useful life.