Exercise 24-14 Computing and interpreting net present value and internal rate of return LO P3, P4 Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial Investment of 5312,000 and would yield the following annual cash flows. (PV of S1. FV of $1. PVA of S1, and EVA [51] (Use appropriate factor(s) from the tables provided.) C1 C2 03 Year 1 540.000 $124,000 $288,000 Year 2 136,000 124,000 88,000 Year 3 196,000 124,000 76,000 Totals 5372,000 $372,000 $372,000 1. Assume that the company requires a 9% return from its investments. Using net present value, determine which projects, Wany, should be acquired 2. Using the answer from part 1, is the internal rate of return higher or lower than 9% for Project C2? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Assume that the company requires a 9% return from its investments. Using net present value, determine which projects, if any, should be acquired. (Negative net present values should be indicated with a minus sign. Round your present value factor to 4 decimals. Round your answers to the nearest whole dollar) Project Ct Initial Investment Chart Values are based on: % Year Cash Inflow PV Factor Present Value so Help Complete this question by entering your answers in the tabs below. Required 1 Required 2 Assume that the company requires a 9% return from its investments. Using net present value, determine which projects, if any, should be acquired. (Negative net present values should be indicated with a minus sign. Round your present value factor to 4 decimals. Round your answers to the nearest whole dollar) Project C1 Initial Investment Chart Values are Based on: % Year Cash Present Inflow Factor Value PV 1 2 3 Project C2 Initial Investment Year Cash Inflow PV Factor Present Value 1 2 Project C2 Initial Investment Year Cash Inflow x PV Factor II Present Value 1 Il 2 11 3 11 Project C3 Initial Investment Year Cash Inflow X PV Factor 11 Present Value 1111 CON 2 3 Required Required 2 > Year 1 Year 2 Year 3 Totals C1 $ 40,000 136,000 196,000 $372,000 C2 $124,000 124,000 124,000 $372,000 C3 $208,000 88,000 76,000 $372,000 1. Assume that the company requires a 9% return from its investments. Using net present value, determine which projects, if any, should be acquired 2. Using the answer from part 1, is the internal rate of return higher or lower than 9% for Project C2? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Using the answer from part 1, Is the Internal rate of return higher or lower than 9% for Project C2? Is the internal rate of return higher or lower than 9% for Project C2?
