Question 26 Cheyenne Company is considering two capital investment proposals. Estimates regarding each project are provided below: Initial investment Annual net income Net annual cash inflow Estimated useful life Salvage value Project Soup $400000 46000 122000 5 years Project Nuts $600000 62000 153000 6 years The company requires a 10% rate of return on all new investments Periods 5 6 Present Value of an Annuity of 1 9% 10% 11% 12% 3.89 3.791 3.696 3.605 4.486 4.355 4.231 4.111 The annual rate of return for Project Soup is O 61% O 30.5% O 11.5% O 23%