Dwight Donovan, the president of Fanning Enterprises, is considering two investment opportunities. Because of limited resources, he will be able to invest in only one of them. Project A is to purchase a machine that will enable factory automation; the machine is expected to have a useful life of four years and no salvage value. Project B supports a training program that will improve the skills of employees operating the current equipment. Initial cash expenditures for Project A are $400,000 and for Project B are $160,000. The annual expected cash inflows are $126,000 for Project A and $52,800 for Project B. Both investments are expected to provide cash flow benefits for the next four years. Donovan Enterprises' desired rate of return is 8 percent.

Required

a.Compute the net present value of each project. Which project should be adopted based on the net present value approach? Round your computations to 2 decimal points.

b.Compute the approximate internal rate of return of each project. Which one should be adopted based on the internal rate of return approach? Round your rates to 6 decimal points.

c.Compare the net present value approach with internal rate of return approach. Which method is better in the given circumstances? Why?

Check Figures

a.NPV of A: $17,328.00

b.Rate of return of B: 12%

Use Excel?showing all work and formulas - Could I see the excel workpage as well please? I don't understand the explanation and the excel is incomplete, can i get an clear explanation on this?