Sheridan Corporation is considering two investment opportunities with cash flows as described below Project J Cash investment now $40,000 Cash inflow at the end of 3 years $30,000 Cash inflow at the end of 7 years $50,000 Project K Cash investment now $40,000 Annual cash inflow for 5 years $15,000 Cash outflow at the end of 6 years $11,000 Additional cash inflow at the end of 7 years $15,000 Required (9 points) Compute the net present value of each project assuming Sheridan Corporation uses a 13 discount rate Which investment would you recommend they accept Why 20 Sheridan Corporation is considering two investment opportunities with cash flows as described below Project Cash investment now Cash inflow at the end of 3 years Cash inflow at the end of 7 years $40,000 $30,000 $50,000 Project K Cash investment now Annual cash inflow for 5 years Cash outflow at the end of 6 years Additional cash inflow at the end of 7 years $40,000 $15 000 $11,000 $15,000 Required (9 points) Compute the net present value of each project assuming Sheridan Corporation uses a 13 discount rate Which investment would you recommend they accept Why

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Sheridan Corporation is considering two investment opportunities with cash flows as described below: Project J: Cash investment now $40,000 Cash inflow at the end of

Sheridan Corporation is considering two investment opportunities with cash flows as described below:

Project J:

Cash investment now $40,000

Cash inflow at the end of 3 years $30,000

Cash inflow at the end of 7 years $50,000

Project K:

Cash investment now $40,000

Annual cash inflow for 5 years $15,000

Cash outflow at the end of 6 years $11,000

Additional cash inflow at the end of 7 years $15,000

Required (9 points): Compute the net present value of each project assuming Sheridan Corporation uses a 13% discount rate. Which investment would you recommend they accept? Why?

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20. Sheridan Corporation is considering two investment opportunities with cash flows as described below: Project : Cash investment now Cash inflow at the end of 3 years Cash inflow at the end of 7 years $40,000 $30,000 $50,000 Project K: Cash investment now Annual cash inflow for 5 years Cash outflow at the end of 6 years Additional cash inflow at the end of 7 years $40,000 $15.000 $11,000 $15,000 Required (9 points): Compute the net present value of each project assuming Sheridan Corporation uses a 13% discount rate. Which investment would you recommend they accept? Why