Q: Tranter, Inc., is considering a project that would have a five-year life and would require a $900,000 investment in equipment. At the end of five years, the project would terminate and the equipment would have no salvage value. The project would provide net operating income each year as follows: Sales 1,700,000 Variable expenses 1,200,000 Contribution margin 500,000 Fixed expenses: Fixed (out of pocket cash) Depreciation (non-cash expense) Net operating income 200,000 180,000 380,000 120,000 All of the above items, except for depreciation, represent cash flows. The company's required rate of return = 12%. equired: Compute the project's payback period. Compute the project's net present value. Compute the project's internal rate of return to the nearest whole percent.

Q7 (7 marks): Tranter, Inc., is considering a project that would have a five-year life and would require a $900,000 investment in equipment. At the end of five years, the project would terminate and the equipment 12% equired: Compute the project's payback period. Compute the project's net present value. Compute the project's internal rate of return to the nearest whole percent