The application of capital budgeting and cash flow forecasts go hand in hand when determining which capital projects to invest in$.$

Cash flows, both positive cash flows with increased revenues and negative cash flows with costs and expenses, determine the success or failure of capital projects. This discussion is important for the course because it covers important factors that need to be considered with long$-$term investment acquisitions. These concepts will be employed in the Unit $6$ assignment.

For this discussion, you are financial analyst working for Broadcom $($ticker symbol AVGO$),$ which is a huge chip manufacturer. It is considering the acquisition of a competing chip firm, Qualcomm $($ticker symbol QCOM$).$ The CFO of Broadcom has tasked you with evaluating the potential deal. Before Broadcom employs any capital budgeting tools to decide whether the deal should go through, it needs to determine the anticipated cash flows of the newly merged company.

As the financial analyst, how would you go about finding out if it is an investment worth doing?

What are the types of cash flows financial analysts would need to examine before performing capital budgeting analysis?

What additional revenues and costs should be evaluated? What risks could exist with the acquisition?