Question
ACE Corporation is considering two exclusive investments. The company's cost of capital is 12% and the tax rate is 28%. Below are the details: Particulars
ACE Corporation is considering two exclusive investments. The company's cost of capital is 12% and the tax rate is 28%. Below are the details:
Particulars | Investment A | Investment B |
Cost of investment | 17,00,000 | 20,00,000 |
Expected life | 5 years | 5 years |
Annual Income (before Tax & Depreciation) | 4,75,000 | 6,00,000 |
Depreciation is charged on a straight-line basis. You are required to calculate: a. Internal Rate of Return (IRR) b. NPV c. Payback period
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Intermediate Algebra
Authors: Margaret Lial, John Hornsby, Terry McGinnis
13th Edition
0134895983, 978-0134895987
