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Sunrise Solar Corp. is evaluating two solar panel projects. The company’s required rate of return is...

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Accounting

Sunrise Solar Corp. is evaluating two solar panel projects. The company’s required rate of return is 16%. Use appropriate factors from the tables provided.

  • Project SunA: Initial Investment: $300,000; Year 1: $100,000; Year 2: $120,000; Year 3: $140,000; Year 4: $60,000
  • Project SunB: Initial Investment: $350,000; Year 1: $120,000; Year 2: $140,000; Year 3: $160,000; Year 4: $80,000
  • a. Compute the payback period for each project. Based on the payback period, which project is preferred?
  • b. Compute the net present value for each project. Based on the net present value, which project is preferred?

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