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Exercise 26-2 Z Your answer is partially correct. Try again. Doug's Custom Construction Company is considering three new projects, each requiring an equipment investment of
Exercise 26-2 Z Your answer is partially correct. Try again. Doug's Custom Construction Company is considering three new projects, each requiring an equipment investment of $22,660. Each project will last for 3 years and produce the following net annual cash flows. year AA BB CC 1 $7,210 $10,300 $13,390 9,270 0,300 12,360 3 12,360 0,300 11,330 Total $28,840 $30,900 $37,080 The equipment's salvage value is zero, and Doug uses straight-line depreciation. Doug will not accept any project with a cash payback period over 2 years. Doug's required rate of return is 12%. Click here view PM table, (a) Compute each project's payback period. (Round answers to 2 decimal places, e.g. 15.25.) 2.50 years BB 2.20 1.75 years CC Which is the most desirable project? The most desirable project based on payback period is Project CC T Which is the least desirable project? The least desirable project based on payback period is Project AA
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