+1-415-670-9189
info@expertsmind.com
What is each projects internal rate of return
Course:- Cost Accounting
Reference No.:- EM13298441




Assignment Help
Assignment Help >> Cost Accounting

Caledonia is considering two additional mutually exclusive projects. The cash flows associated with tese projects are as follows:

Year ProjectA Year Project B
0 -$100,000 0 -$100,000
1 32,000 1 0
2 32,000 2 0
3 32,000 3 0
4 32,000 4 0
5 32,000 5 $200,000

The required rate of return on these projects is 11percent.

a. What is each project's payback period?

b. What is each projects net present value?

c. What is each project's internal rate of return?

d. What has caused the ranking conflict?

e. Which project shoudl be accepted? Why?

f. Describe the factors that Caledonia would have to consider if they were doing a lease versus buy for the two projects.




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Cost Accounting) Materials
Slapshot Company makes ice hockey sticks. On June 1, Slapshot had $42,000 of materials in inventory. During the month of June, the company purchased $180,000 of materials. O
Determine the net present value of the project. Ignore income taxes in this problem.) Janes, Inc., is considering the purchase of a machine that would cost $430,000 and would
Jennifer's Home Remodeling worked on three jobs during March. Job 13 was in process on March 1 with total charges of $5,500. During the month, the additional transactions oc
A citizen of the City of Townsend gives it a gift of $22,000 in investments. The citizen requires that the investments be held but any resulting income must be used to help
Calculate the after-tax cost of debt for the Wallace clinic, a for-profit healthcare provider, assuming that the coupon rate set on its debt is 11 percent and its tax rate
At first glance the Lower-of-Cost-or-Market appears to be an unnecessarily complicated way to do inventory. It seems that it is a requirement to identify methods of accounti
Calculate the production overheads to be absorbed by one unit of each of the products using the following costing methods. A traditional costing approach using a direct labour
Prepare the companys direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours require