Prior to beginning work on this assignment, review Chapter $14$ in your course textbook, Survey of Accounting.

McEntyre Company has $$80,000$ in capital funds available for investment. The capital investment committee at McEntyre Company is currently considering two capital investment projects.

The estimated income from operations and net cash flows expected from each project are as follows:

Project A Project B

Year Income from Operations Net Cash Flow Income from Operations Net Cash Flow

$1$ $ $8,000$ $$24,000$ $ $14,000$ $ $30,000$

$29,00025,00010,00026,000$

$311,00027,0008,00024,000$

$48,00024,0007,00023,000$

$58,00024,0003,00019,000$

$$44,000$ $$124,000$ $$42,000$ $$122,000$

Each project requires an investment of $$80,000.$ Straight$-$line depreciation will be used, and no residual value is expected. The committee has selected a rate of $20\%$ as the minimum average rate of return for capital investments.

Analyze the projects and prepare a report for the capital investment committee, advising it of the relative merits of each project.

In your paper,

Explain the purpose of the report and describe the nature and importance of capital investment analysis.

Analyze each long$-$term capital investment project based on the average rate of return.

Compute the average rate of return for each project and show your work.

Determine whether each project meets the minimum average rate of return required by the committee.

Discuss the advantages and disadvantages of the average rate of return method.

Rank the projects based on average rate of return.

Analyze each project based on cash payback period.

Determine the cash payback period for each project. Assume that net cash flows for both projects are uniform throughout the year.

Discuss the advantages and disadvantages of the cash payback method.

Rank the projects based on the cash payback period.

Discuss at least three factors that could potentially complicate your capital investment analysis.

Summarize your analysis and make a recommendation to the capital investment committee regarding which project the committee should fund.

The McEntyre Capital Investment Report final paper

must be $3$ to $4$ double$-$spaced pages in length $($not including title and references pages$)$ and formatted according to APA StyleLinks to an external site. as outlined in the Writing Center$$s APA Formatting for Microsoft WordLinks to an external site. resource.

must include a separate title page with the following in title case:

title of final paper in bold font

Space should appear between the title and the rest of the information on the title page.

student$$s name

name of institution $($The University of Arizona Global Campus$)$

course name and number

instructor$$s name

due date

must utilize academic voice. Review the Academic VoiceLinks to an external site. resource for additional guidance.

must include an introduction and conclusion paragraph.

Your introduction paragraph needs to end with a clear thesis statement that indicates the purpose of your paper.

For assistance on writing Introductions & ConclusionsLinks to an external site. and Writing a Thesis StatementLinks to an external site., refer to the Writing Center resources.

must use APA level headings, found on the Writing Center$$s APA Style ElementsLinks to an external site. page, for each one of the topics discussed in the research paper as shown:

Introduction Level $1$

Average Rate of Return Analysis Level $1$

Cash Payback Period Analysis Level $1$

Potential Complicating Factors Analysis Level $1$

Summary and Recommendation Level $1$

must use at least four scholarly sources in addition to the course text.

The Scholarly, Peer$-$Reviewed, and Other Credible SourcesLinks to an external site. table offers additional guidance on appropriate source types. If you have questions about whether a specific source is appropriate for this assignment, please contact your instructor. Your instructor has the final say about the appropriateness of a specific source.

To assist you in completing the research required for this assignment, review this Quick and Easy Library ResearchLinks to an external site. tutorial, which introduces the University of Arizona Global Campus Library and the research process, and provides some library search tips.

To assist you in completing the research for this assignment, review Company Research in the UAGC LibraryLinks to an external site. tip sheet and How to Use Library OneSearchLinks to an external site. video.

must document any information used from sources in APA Style as outlined in the Writing Center$$s APA: Citing Within Your PaperLinks to an external site. guide.

must include a separate references page that is formatted according to APA Style as outlined in the Writing Center. Review the APA: Formatting Your References ListLinks to an external site. resource in the Writing Center for specifications.