Please show work with excel cells
Homework Answers
If the payback period needs to be calculated then the discount rate is not required as it is used only for the discounted payback period method.
As the annual cash flows are the same as 15,000 and 32,000 respectively, the formula will be: Cash outflow/Annual cash inflow
So in excel, just divide 15000 by 15000 for system 1 and the payback period will be 1 year,
For system 2, divide 45000 by 32000, the payback period will be 1.41 years
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Please show work with excel cells
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Problem 10.06 Sunland Incorporated management is considering investing in two alternative production systems. The systems are mutually exclusive, and the cost of the new equipment and the resulting cash flows are shown in the accompanying table. The firm uses a 7 percent discount rate for their production systems Year System 1 System 2 $13,600 13,600 13,600 13,600 $46,200 32,400 32,400 32,400 0 2 What are the payback periods for production systems 1 and 2? (Round answers to 2 decimal places,...
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Please show all work. Must be completed using financial formulas, NO EXCEL. a. Calculate the NPV, IRR, MIRR, and traditional payback period for each project, assuming a required rate of return of 8%....
Please show all work.
Must be completed using financial formulas, NO EXCEL.
a. Calculate the NPV, IRR, MIRR, and traditional payback period
for each project, assuming a required rate of return of 8%.
b. If the projects are independent, which project(s) should be
selected? If they are mutually exclusive, which project should be
selected?
Project P costs $10,400 and is expected to produce cash flows of $3,650 per year for five years. Project Q costs $30,000 and is expected to...
I am needing help with the excel formulas for the following question (the cells highlighted in...
I am needing help with the excel formulas for the following question (the cells highlighted in green.) Problem 1. West Coast Company is considering two mutually exclusive projects, the project's expected net cash flows are as follows: Expected Cash Flows Year Proj. A Proj. B 0 ($40,000) ($30,000) 1 ($12,000) $8,500 2 $10,000 $8,500 3 $35,000 $8,500 4 $14,000 $8,500 5 $25,000 $8,500 Required Rate of Return 14.00% 14.00% 1.c. (8 points) Calculate the crossover rate of these two...
I am needing help with the excel formulas for the following problem (the cells highlighted in...
I am needing help with the excel formulas for the following problem (the cells highlighted in green) Problem 1. West Coast Company is considering two mutually exclusive projects, the project's expected net cash flows are as follows: Expected Cash Flows Year Proj. A Proj. B 0 ($40,000) ($30,000) 1 ($12,000) $8,500 2 $10,000 $8,500 3 $35,000 $8,500 4 $14,000 $8,500 5 $25,000 $8,500 Required Rate of Return 14.00% 14.00% 1.a. (8 points) Calculate each project's IRR (IRR should be...
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Choosing between two projects with acceptable payback periods Shell Camping Gear, Inc., is considering two mutually exclusive projects. Each requires an initial investment of $180,000. John Shell, president of the company, has set a maximum payback period of 4 years. The after-tax cash inflows associated with each project are shown in the following table: a. Determine the payback period of each project. b. Because they are mutually exclusive, Shell must choose one. Which should the company invest in? a. The...
Please show all work.
Must be completed using financial formulas, NO EXCEL.
a. Calculate the NPV, IRR, MIRR, and traditional payback period
for each project, assuming a required rate of return of 8%.
b. If the projects are independent, which project(s) should be
selected? If they are mutually exclusive, which project should be
selected?
Project P costs $10,400 and is expected to produce cash flows of $3,650 per year for five years. Project Q costs $30,000 and is expected to...
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