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Perit Industries has $165,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Project A Project
Perit Industries has $165,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Project A Project B $165, 000 $ Cost of equipment required Working capital investment required Arnual cash inflows Salvage value of equient in six years Life of the project 0 165, 000 $ 21,000 56, 000 $ 9, 500 $ 6 years 6 years The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 14%. Click here to view Exhibit 128-1 and Exhibit 12B-2. to determine the appropriate discount factor(s) using tables
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