24.

Whispering Winds Inc. is comparing several alternative capital budgeting projects as shown below:

	Projects
	A	B	C
Initial investment	$78000	$118000	$158000
Present value of net cash flows	88000	108000	198000

Using the profitability index, the projects rank as

C, A, B.

C, B, A.

A, C, B.

A, B, C.

27.

Larkspur, Inc. is considering purchasing equipment costing $44000 with a 6-year useful life. The equipment will provide annual cost savings of $10703 and will be depreciated straight-line over its useful life with no salvage value. Larkspur requires a 10% rate of return.

	Present Value of an Annuity of 1
Period	8%	9%	10%	11%	12%	15%
6	4.623	4.486	4.355	4.231	4.111	3.784

What is the approximate internal rate of return for this investment?

12%

9%

10%

11%

38. A standard cost is

the historical cost of producing a product last year.

a cost which is paid for a group of similar products.

the average cost in an industry.

a predetermined cost.

thats all that has been given