Perit Industries has $110,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are:

Perit Industries has $110,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are Cost of equipment required Working capital investment required Annual cash inflows Salvage value of equipment in six years Life of the project Project A $110,000 $O $20,000 $8,600 6 years Project B $0 $110,000 $68,000 $0 6 years The working capital needed for project B will be released at the end of six years for investment elsewhere. Pent Industries' discount rate is 16% Click here to view Exhibit 11B-1 and Exhibit 11B-2, to determine the appropriate discount factor(s) using tables Required a. Calculate net present value for each project. Project A Project E Net present value b. Which investment alternative (if either) would you recommend that the company accept? Project A Project B