• a company has secured a $3.7 million loan from their local bank and agreed to a 10-year loan at 5.15% interest compounded monthly. Payments will be $35,000 per month. Once they get the funds, they will pay a $10,000 loan application fee.

• The companys tax rate is 20%

• They have set the following analysis:
  • Required rate of return: 10%
  • Payback: 20 months
  • Average Accounting Return: 15%
  • Profitability Index: 1.4
  • what is the payback? what is the average accounting rate of return? net present value? internal rate of return? profitability index?