Question
Eta Technologies is evaluating a new project with an initial investment of $300,000. The project is expected to generate annual cash flows of $80,000 for
Eta Technologies is evaluating a new project with an initial investment of $300,000. The project is expected to generate annual cash flows of $80,000 for 5 years. The company’s cost of capital is 12%.
Requirement: Calculate the payback period, NPV, and IRR for the project. Should Eta Technologies proceed with the project? Provide a detailed explanation based on your calculations.
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Financial Accounting Tools for Business Decision Making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
6th Canadian edition
1118644948, 978-1118805084, 1118805089, 978-1118644942
