Question
Management of Jabs Inc. is considering two projects. Based on the cash flows provided and an 9.5% discount rate, calculate the payback period, net present
Management of Jabs Inc. is considering two projects. Based on the cash flows provided and an 9.5% discount rate, calculate the payback period, net present value, internal rate of return, and modified internal rate of return (assume reinvestment rate of 4.25%).
| Year | Project A | Project B |
| 0 | -25,000 | -25,000 |
| 1 | 10,000 | 7,000 |
| 2 | 8,000 | 9,000 |
| 3 | 8,000 | 11,000 |
| 4 | 9,000 | 7,000 |
| Capital Budgeting Tool | Project A | Project B |
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Payback Period
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Net Present Value (NPV)
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Internal Rate of Return (IRR)
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Modified Internal Rate of Return (MIRR)
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Which project should be accepted if mutually exclusive? ______________________________
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Fundamental accounting principle
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
21st edition
1259119831, 9781259311703, 978-1259119835, 1259311708, 978-0078025587
