Problem 8-21 NPV and Payback Period [LO 1, 4]

Andouille Spices, Incorporated, has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 10 percent.

YearProject FProject G0$ 130,000$ 200,000162,50042,500247,50057,500357,50087,500452,500117,500547,500132,500

Calculate the payback period for both projects.

Note: Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.

Calculate the NPV for both projects.

Note: Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.

Which projct, if any should the company accept