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it is an attachment of the question which i need your help a) Thika Holdings Kenya Limited deals in fresh produce for export. They would

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it is an attachment of the question which i need your help

image text in transcribed a) Thika Holdings Kenya Limited deals in fresh produce for export. They would like to increase their market share. Two projects have been identified as suitable for this purpose. Project A will cost and initial cost of Ksh. 50 million while project B will cost and initial amount of Kshs. 60 million. The following cash flows have been identified for both projects. Net cash Flows Year 1 2 3 4 5 6 7 Project A 22, 000, 000 16, 000, 000 13,000,000 10,000,000 8,000,000 7,000,000 3,000,000 Project B 6,000,000 8, 000, 000 11,000,000 12,000,000 14,000,000 19,000,000 27,000,000 Taking a discount rate of 10%, assess the suitability of the capital projects using the following methods. (1) Payback period. (4 mks) (2) Net present value method. (4 mks) (3) Profitability index. (3 mks)

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