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Question 5 (19 Marks) Note the following information on two mutually exclusive projects under consideration by Woollies Food Market company Annual Cash Flows Year B

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Question 5 (19 Marks) Note the following information on two mutually exclusive projects under consideration by Woollies Food Market company Annual Cash Flows Year B 0 -R30 000 1 2 -R60,000 R20,000 R20,000 R20,000 R20,000 R20,000 R10,000 R10,000 R10,000 R10,000 R10,000 3 4 5 Woollies requires a 14 percent rate of return on projects of this nature Required. 5 1 Calculate the NPV of both projects 52 Calculate the profitability index of both projects 53 Calculate the payback on both projects 54 Calculate the discounted payback on both projects 55 Which of the two projects, if either, should Woollies accept? Why? (4) (4) (4) (4) (3)

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