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Henkel Company is considering three long-term capital investment proposals. Each investment has a useful life of 5 years. Relevant data on each project are as
Henkel Company is considering three long-term capital investment proposals. Each investment has a useful life of 5 years. Relevant data on each project are as follows.
Project Kilo | Project Lima | Project Oscar | ||||||
Capital investment | $168,950 | $179,850 | $202,800 | |||||
Annual net income: | ||||||||
Year | 1 | 14,170 | 19,075 | 29,975 | ||||
2 | 14,170 | 17,985 | 24,525 | |||||
3 | 14,170 | 16,895 | 23,435 | |||||
4 | 14,170 | 12,535 | 14,715 | |||||
5 | 14,170 | 9,265 | 13,625 | |||||
Total | $70,850 | $75,755 | $106,275 |
Depreciation is computed by the straight-line method with no salvage value. The company
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