Comparison of Capital Budgeting Methods 1. Determine the payback period for an investment 2. Evaluate the acceptability of an investment project using the net present value method. 3. Evaluate the acceptability of an investment project using the internal rate of return method. 4. Compute the simple rate of return for an investment. All answers must be entered as a formula. Click OK to begin. OK Determine the payback period for an investment. Evaluate the acceptability of an investment project using the net present value method. Evaluate the acceptability of an investment project using the internal rate of return method. Compute the simple rate of return for an investment. 5 X Sign In Paste V D E Comparison of Capital Budgeting Methods - Excel FILE HOME INSERT PAGE FORMULAS DATA REVIEW VIEW X Calibri - 11-AA 96 BIU SA - AlignmeNumbefonditio Format Cell Cells Formattir as Styles Clipboard Font Styles A1 Fu Laurman, Inc. is considering the following project: B 1 Laurman, Inc. is considering the following project: 2 Required investment in equipment $ 2.205.000 3 Project life 7 4 Salvage value 225.000 5 6 The project would provide net operating income each year as follows: 7 Sales $ 2.750.000 8 Variable expenses 1.500.000 Contribution margin $ 1.150.000 Fixed expenses Salaries, rent and other fixed out of pocket costs $ 520.000 12 Depreciation 350.000 Total fixed expenses 870.000 Net operating income 280.000 15 16 Company discount rate 189 17 18 1. Compute the annual net cash inflow from the project. 19 20 2. Complete the table to compute the net present value of the investment 21 Year(s) 23 Now 1-7 Sheet1 2 READY Attempt(s) 9 10 11 13 400% Hint ? - Sign In