BE 25-1 Average rate of return Determine the average rate of return for a project that is estimated to yield total income of $170,000 over five years, has a cost of $320,000, and has a $20,000 residual value. BE 25-2 Cash payback period A project has estimated annual net cash flows of $36,500. It is estimated to cost $222,650. Determine the cash payback period. (Round to one decimal place.) BE 25-3 Net present value A project has estimated annual net cash flows of $70,000 for four years and is estimated to cost $190,000. Assume a minimum acceptable rate of return of 10%. Using Exhibit 5 (below), determine (A) the net present value of the project and (B) the present value index, rounded to two decimal places. . Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.868 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 BE 25-4 Internal rate of return 0.893 A project is estimated to cost $463,565 and provide annual net cash flows of $115,000 for nine years. Determine the internal rate of return for this project, using Exhibit 5 (below). Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 1 0.943 0.909 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 7 5.582 4.868 4.564 4.160 3,605 8 6.210 5.335 4.968 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 To receive credit for this assignment, students have the following options