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Question #2:- Payback Period -- 8 points The Blue Egg Company is considering starting two Independent Projects. The Treasurer uses the Payback Period method and
Question #2:- Payback Period -- 8 points The Blue Egg Company is considering starting two Independent Projects. The Treasurer uses the Payback Period method and a 5-year cut-off decision point for evaluating projects. "The Company projects the cash flow for the two projects as indicated below:- Cash Flows Project M Project P Year 0 2 3 ($186,000) $38,000 $36,600 $49,600 $30,800 $29,600 $18,800 ($112,000) $42,400 $55,600 $18,200 $9,800 $8,400 $4,400 4 5 6 Required: A. Should the Blue Egg Company accept Project:M? Why or Why not? B.-Should the Blue Egg Company accept Project -P? Why or Why not? C.-What are the disadvantages of using the Payback Period
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