Question

Timeline Manufacturing Co. is evaluating two projects. The company uses payback criteria of three years or...

Timeline Manufacturing Co. is evaluating two projects. The company uses payback criteria of three years or less. Project A has a cost of $845,140, and project B’s cost is $1,190,400. Cash flows from both projects are given in the following table.

Year Project A Project B
1 $86,212 $586,212
2 313,562 413,277
3 427,594 231,199
4 285,552


What are their discounted payback periods? (Round answers to 2 decimal places, e.g. 15.25. If discounted payback period exceeds life of the project, enter 0.00 for the answer.)

Discounted payback periods of project A
Discounted payback periods of project B


Which will be accepted with a discount rate of 8 percent?

Timeline should choose

Project Aneither projectProject BBoth projects

.
Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Management of Crane Measures, Inc., is evaluating two independent projects. The company uses a 12.62 percent...
Management of Crane Measures, Inc., is evaluating two independent projects. The company uses a 12.62 percent discount rate for such projects. The costs and cash flows for the projects are shown in the following table. Year Project 1 Project 2 0 - $8,066,549 - $11,655,500 1 3,003,590 2,165,830 2 1,608,490 3,783,590 3 1,465,800 2,820,680 4 1,061,800 4,040,500 5 1,153,880 4,449,580 6 1,708,040 7 1,266,990 a. What are the IRRs for the projects? (Round final answer to 2 decimal places, e.g....
Cullumber Crafts Corp. management is evaluating two independent capital projects that will each cost the company...
Cullumber Crafts Corp. management is evaluating two independent capital projects that will each cost the company $290,000. The two projects will provide the following cash flows: Year Project A Project B 1 $84,750 $66,000 2 103,450 99,000 3 24,235 137,250 4 129,655 98,110 Collapse question part (a1) What is the payback period of both projects? (Round answers to 2 decimal places, e.g. 15.25.)
Company B’s WACC is 10%. It has three Projects it can choose from: Projects X, Y...
Company B’s WACC is 10%. It has three Projects it can choose from: Projects X, Y and Z. The following information is available regarding Project X. Years 0 1 2 3 Cash Flows -$100 $80 $60 $40 And the following information is available regarding Projects Y and Z. Criteria Project Y Project Z NPV $40 $67 MIRR 10% 20% IRR 6.5% 18.7% Regular Payback 2.23 years 1.77 years 1) If IRR for Project X is 17.95%, and the three project...
CAPITAL BUDGETING CRITERIA A firm with a 14% WACC is evaluating two projects for this year's...
CAPITAL BUDGETING CRITERIA A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M -$18,000 $6,000 $6,000 $6,000 $6,000 $6,000 Project N -$54,000 $16,800 $16,800 $16,800 $16,800 $16,800 Calculate NPV for each project. Round your answers to the nearest cent. Do not round your intermediate calculations. Project M    $ Project N    $ Calculate IRR for each project. Round your answers to two...
CAPITAL BUDGETING CRITERIA A firm with a 13% WACC is evaluating two projects for this year's...
CAPITAL BUDGETING CRITERIA A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M -$27,000 $9,000 $9,000 $9,000 $9,000 $9,000 Project N -$81,000 $25,200 $25,200 $25,200 $25,200 $25,200 Calculate NPV for each project. Round your answers to the nearest cent. Do not round your intermediate calculations. Project M    $ Project N    $ Calculate IRR for each project. Round your answers to two...
Crane Corp. management is evaluating two mutually exclusive projects. The cost of capital is 15 percent....
Crane Corp. management is evaluating two mutually exclusive projects. The cost of capital is 15 percent. Costs and cash flows for each project are given in the following table. Year Project 1 Project 2 0 -$1,292,224 -$1,321,796 1 238,000 384,000 2 329,000 384,000 3 430,000 384,000 4 504,000 384,000 5 800,000 384,000 Calculate NPV and IRR of two projects. (Enter negative amounts using negative sign, e.g. -45.25. Do not round discount factors. Round other intermediate calculations and final answer to...
A firm can invest Rs.5,00,000 in maximum 2 of the following projects. Use Discounted Payback criteria...
A firm can invest Rs.5,00,000 in maximum 2 of the following projects. Use Discounted Payback criteria and another most suitable criteria (justify the choice in two lines) to choose the best two. Your firm's WACOC is 15% p.a. Project 0 1 2 3 4 A -2,50,000 0 0 +1,30,000 + 1,80,000 B -2,50,000 +1,30,000 +1,80,000 0 0 C -1,90,000 + 30,000 + 40,000 + 80,000 + 1,00,000
Nugent Communication Corp. is investing $9,020,368 in new technologies. The company expects significant benefits in the...
Nugent Communication Corp. is investing $9,020,368 in new technologies. The company expects significant benefits in the first three years after installation (as can be seen by the following cash flows), and smaller constant benefits in each of the next four years. Year 1 2 3 4-7 Cash Flows $2,451,652 $4,674,513 $3,858,041 $1,158,500 What is the discounted payback period for the project assuming a discount rate of 10 percent? (Round answer to 2 decimal places, e.g. 15.25. If discounted payback period...
You will be evaluating three projects for Hasbro Toys. Hasbro's cost of capital or discount rate...
You will be evaluating three projects for Hasbro Toys. Hasbro's cost of capital or discount rate is 10%. The first project (A) will cost $25,000 initially. The project will then return cash flows of $8,000 for 4 years. The second project (B) will cost $40,000 initially. The project will then return cash flows of $15,000 for the next 2 years and $10,000 for 2 years after that. The third project (C) will cost $30,000 initially. The project will then return...
Crane Corp. management is evaluating two mutually exclusive projects. The cost of capital is 15 percent....
Crane Corp. management is evaluating two mutually exclusive projects. The cost of capital is 15 percent. Costs and cash flows for each project are given in the following table. Year Project 1 Project 2 0 -$1,304,168 -$1,325,262 1 264,000 379,000 2 365,000 379,000 3 445,000 379,000 4 539,000 379,000 5 739,000 379,000 Calculate NPV and IRR of two projects. (Enter negative amounts using negative sign, e.g. -45.25. Do not round discount factors. Round other intermediate calculations and final answer to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT