All techniques Decision among mutually exclusive investments Pound Industries is attempting to select the best...
70.2K
Verified Solution
Link Copied!
Question
Accounting
All techniques Decision among mutually exclusive investments Pound Industries is attempting to select the best of three mutually exclusive projects. The initial investment and after-tax cash inflows associated with these projects are shown in the following table Cash flows Project A Project B Project C $90,000 $130,000 Initial investment (CF) $140,000 Cash inflows (CF), t 1 to 5 $30,000 $41,500 $42,000 a. Calculate the payback period for each project. b. Calculate the net present value (NPV of each project, assuming that the firm has a cost of capital equal to 14%. c. Calculate the internal rate of return (IRR) for each project. d. Indicate which project you would recommend a. The payback period of project A is years. (Round to two decimal places.) The payback period of project Bis years. (Round to two decimal places.) The payback period of project C is years. (Round to two decimal places. b. The NPV of project A is (Round to the nearest cent.) The NPV of project B is Round to the nearest cent. The NPV of project C is Round to the nearest cent. c. The IRR of project Ais Round to two decimal places
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
