Reference no: EM13575199

Sanchez Corporation is considering three long-term capital investment proposals. Relevant data on each project are as follows.

		Project
		Brown		Red		Yellow
Capital investment		$191,900		$219,710		$249,200
Annual net income:
Year 1		25,032		20,079		26,002
2		16,357		20,079		24,241
3		13,403		20,079		23,078
4		10,262		20,079		17,402
5		8,357		20,079		20,463
Total		$ 73,411		$100,395		$111,186

Your answer is correct.

Compute the annual rate of return for each project. (Round answers to 1 decimal place, e.g. 10.5%.)

		Annual rate of return
Project Brown		15.3	%
Project Red		18.2	%
Project Yellow		17.8	%

Your answer is correct.

Compute the cash payback period for each project. (Round answers to 2 decimal place, e.g. 5.25.)

		Cash Payback
Project Brown		3.45	years
Project Red		3.43	years
Project Yellow		3.39

Your answer is incorrect. Try again.

Compute the net present value for each project. (Round PV factor to 5 decimal places, e.g. 1.25356 and final answer to 0 decimal places, e.g. 1,255.)

		Net present value
Project Brown		$
Project Red		$
Project Yellow		$