Calculate$($a$)$ net present$$ value, $($b$)$ payback$$ period, $($c$)$ discounted payback$$ period, and$($d$)$ internal rate of return.

$2.$

Compare and contrast the capital budgeting methods in requirement $1.$

DATA TABLCost of the equipment

$$109,000$

Reduced annual labor costs

$$35,000$

Estimated life of equipment

$5$ years

Terminal disposal value

$$0$

After$-$tax cost of capital

$8\%$

Tax rate

$40\%$

Assume depreciation is calculated on a$$ straight$-$line basis for tax purposes. Assume all cash flows occur at$$ year$-$end except for initial investment amounts.

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