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 Kilo		Project Lima		Project Oscar
Capital investment		$166,000		$178,000		$204,000
Annual net income:
Year 1		14,420		18,540		27,810
2		14,420		17,510		23,690
3		14,420		16,480		21,630
4		14,420		12,360		13,390
5		14,420		9,270		12,360
Total		$72,100		$74,160		$98,880

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.)

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

Project		Cash Payback		Net Present Value		Annual Rate of Return
Kilo		select a ranking numberselect a ranking number 1 3 2		select a ranking numberselect a ranking number 2 3 1		select a ranking numberselect a ranking number 3 2 1
Lima		select a ranking numberselect a ranking number 1 3 2		select a ranking numberselect a ranking number 1 2 3		select a ranking numberselect a ranking number 1 2 3
Oscar		select a ranking numberselect a ranking number 1 3 2		select a ranking numberselect a ranking number 1 2 3		select a ranking numberselect a ranking number 1 2 3

The best project is select a projectselect a project Kilo/Lima/Oscar.