Reference no: EM132598372

Mountain Manufacturing is considering the following capital investment proposals.? Mountain's requirement criteria include a maximum payback period of five years and a required rate of return of? 12.5%. Determine if each investment is acceptable or should be rejected? (ignore qualitative? factors). Rank the acceptable investments in order from most desirable to least desirable.

Project         Payback           NPV         IRR          Profitability Index

A                3.15 years       $ 10,250    13.0%       1.54

B                 4.20 years       $ 42,226   14.2%       1.92

C                    2.00 years   $ (10,874)   8.5%      0.75

D                 3.25 years        $ 36,251   14.0%        2.86

E                    5 years            $ 0           12.5%          1

Question 1: Determine if each investment is acceptable or should be rejected? (ignore qualitative? factors).

Question 2: Rank the acceptable investments in order from most desirable to least desirable. Acceptable investments are those which are not rejected by any of the capital budgeting methods.