Also,

3. Compute the annual rate of return for each project.

4. Rank the projects on each of the foregoing bases. Which project do you recommend?

Problem 26-1A (Part Level Submission) U3 Company is considering three long-term capital investment proposals. Each investment has a useful life of 5 years. Relevant data on each project are as follows. Project Bono $172,800 Project Edge $189,000 Project Clayton $206,000 Capital investment Annual net income: Year 1 15,120 15,120 15,120 15,120 15,120 $75,600 19,440 18,360 17,280 12,960 9,720 $77,760 29,160 24,840 22,680 14,040 12,960 $103,680 5 Total Depreciation is computed by the straight-line method with no salvage value. The company's cost of capital is 15%. (Assume that cash flows occur evenly throughout the year.) ck here to view PV table Your answer is partially correct. Try again Compute the net present value for each project. (Round answers to O decimal places, e.g. 125. If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Project Bono Project Edge Project Clayton Net present value -6263 7849 5687