Question
I need help with this problem, please send an explanation U3 Company is considering three long-term capital investment proposals. Each investment has a useful life
I need help with this problem, please send an explanation
U3 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 Bono Project Edge Project Clayton
Capital investment$164,800$180,250$206,000
Annual net income:Year1 14,42018,540 27,810
2 14,42017,510 23,690
3 14,42016,480 21,630
4 14,42012,360 13,390
5 1 ,44209,270 12,360
Total $72,100$74,160 $98,880
Depreciation is computed by the straight-line method with no salvage value. The company's cost of capital is 15%. (Assume that cash flows occur evenly throughout the year.)
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(a)
Your answer is partially correct.Try again.
Compute the cash payback period for each project.(Round answers to 2 decimal places, e.g. 10.50.)
Project Bono
yearsProject Edge
yearsProject Clayton
years
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