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Question 1 Syarikat Embun Berhad ( SEB ) is considering the following projects: table [ [ , Ringgit Malaysia ] , [ Project ,

Question 1
Syarikat Embun Berhad (SEB) is considering the following projects:
\table[[,Ringgit Malaysia],[Project,Initial outlay,Net cash inflows for year:],[,,1,2,3,4,5],[Timur,70,000,26,000,26,000,26,000,26,000,26,000],[Barat,90,000,27,000,27,000,27,000,27,000,27,000],[Utara,100,000,28,000,28,000,28,000,28,000,28,000]]
From the information given, you are required to answer the following questions.
a. Calculate the Payback Period for each project. Show the formula and your workings. (6 Marks)
b. Calculate the Net Present Value for each project assuming a 15% discount rate. Show the formula and your workings.
(12 Marks)
c. Given the information that SEB imposes a 4-year acceptable payback period, and these projects are independent, what decision should be made? Explain your answer.
(6 Marks)
d. Given the information that SEB imposes a 4-year acceptable payback period, and the projects are mutually exclusive, what decision should be made? Explain your answer.
(6 Marks)
(Total: 30 Marks)
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