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 |
INITIAL INVESTMENT (CF) | $90,000 | $130,000 | $120,000 |
CASH INFLOWS (CF), t=1 to 5 | $30,000 | $41,000 |
$41,500 |
a.??Calculate the payback period for each project.
payback period = initial investment / after-tax cash flow
initial investment of project A is:
round to the nearest dollar
after-tax cash flow of project A is:
round to the nearest dollar
payback period of project A is:
round to two decimal places
initial investment of project B is:
round to the nearest dollar
after-tax cash flow of project B is:
round to the nearest dollar
payback period of project B is:
round to two decimal places
initial investment of project C is:
round to the nearest dollar
after-tax cash flow of project C is:
round to the nearest dollar
payback period of project C is:
round to two decimal places
b.??Calculate the net present value? (NPV) of each? project, assuming that the firm has a cost of capital equal to 15%.
NPV of project A: $
round to the nearest cent
NPV of project B: $
round to the nearest cent
NPV of project C: $
round to the nearest cent
c.??Calculate the internal rate of return? (IRR) for each project.
IRR of project A: %
round to two decimals
IRR of project B: %
round to two decimals
IRR of project C: %
round to two decimals
d.??Indicate which project you would recommend.
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All techniques-decision among mutually exclusive investments??? Pound Industries is attempting to select the best of three...
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
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 12%.
c. Calculate the internal rate of return
(IRR) for each project.
d. Indicate which...
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 Initial investment (CF) Cash inflows (CF), t= 1 to 5 Project $30,000 $10,000 Project B $60,000 $21,500 Project C $70,000 $22.500 a. Calculate the payback period for each project. b. Calculate the net present value (NPV) of each project, assuming that the...
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 Initial investment (CF) Cash inflows (CF), t-1 to 5 $100,000 $30,000 Project A Project B $120,000 $41,000 Poject C $130,000 $42,500 a. Calculate the payback period for each project. b. Calculate the net present value (NPI) of each project, assuming that...
please answer parts A,B,C,D
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