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please help me its due tomorrow at 12 noon (20) QUESTION 3 CAPITAL EXPENDITURE DECISIONS Selby Enterprise is considering investing in new machinery and the
please help me its due tomorrow at 12 noon
(20) QUESTION 3 CAPITAL EXPENDITURE DECISIONS Selby Enterprise is considering investing in new machinery and the following information is available: Investment R300 000 Cost of capital 12% Scrap value Nil Net profit Net cash flow Year 1 Year 2 Year 3 Year 4 Year 5 13 000 10 000 28 000 37 000 75 000 73 000 70 000 88 000 97 000 135 000 1 years ooo Required: Answer the following questions based on the information given above. 3.1 Calculate the accounting rate of return. (Answer expressed to two decimal places) 3.2 Calculate the payback period. (Answer in years, months and days) 3.3 If a payback period of 2 years is required, will the project be accepted? Why? 3.4 Calculate the net present value. (Amounts rounded off to the nearest Rand) 3.5 Based on the NPV, would the project be accepted? Why? 465
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