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Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 11
| Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 11 percent. |
| Year | Project F | Project G | ||
| 0 | $ | 139,000 | $ | 209,000 |
| 1 | 58,000 | 38,000 | ||
| 2 | 52,000 | 53,000 | ||
| 3 | 62,000 | 92,000 | ||
| 4 | 57,000 | 122,000 | ||
| 5 | 52,000 | 137,000 | ||
| Required: |
| (a) | Calculate the payback period for both projects. (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) |
| Payback period | |
| Project F | years |
| Project G | years |
| (b) | Calculate the NPV for both projects. (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) |
| Net present value | |
| Project F | $ |
| Project G | $ |
| (c) | Which project should the company accept? |
| (Click to select)Project F Project G |
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