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XYZ Company is evaluating two exclusive projects. The company's cost of capital is 14% and...

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Accounting

XYZ Company is evaluating two exclusive projects. The company's cost of capital is 14% and the tax rate is 27%. The details are as follows:

Particulars

Project Kappa

Project Lambda

Cost of project

12,00,000

15,00,000

Expected life

6 years

6 years

Annual Income (before Tax & Depreciation)

3,75,000

4,75,000

Depreciation is charged on a straight-line basis. You are required to calculate: a. Internal Rate of Return (IRR) b. NPV c. Payback period

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