JFJ Coffee Company is evaluating the within-plant distribution system for its new plant. The two systems...
JFJ Coffee Company is evaluating the within-plant distribution system for its new plant. The two systems are: 1) a conveyer system; 2). Forklift. The cost of the capital for the plant is 9%, and the projects’ expected net costs are listed as below:
Expected Net Cash Costs
Year Conveyor Forklift
0 ($300,000) ($120,000)
1 (66,000) (96,000)
2 (66,000) (96,000)
3 (66,000) (96,000)
4 (66,000) (96,000)
5 (66,000) (96,000)
What are the IRR and NPV of each alternative? Which method would you recommend? Justify your answer.
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JFJ Coffee Company is evaluating the
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