Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Solve please Phantom Troupe, Inc. plans to put up a small game lounge. The overall cost of the project is P175,000 which is expected to

Solve please

image text in transcribed
Phantom Troupe, Inc. plans to put up a small game lounge. The overall cost of the project is P175,000 which is expected to exist in seven (7) years. Periods Present value factors 12% 14% 16% 18% 20% 22% 24% 7 4.564 4.288 4.039 3.812 3.605 3.416 3.242 Case A: Annual cash inflows for seven (7) years is P50,000 (WACC is 12%) 1. What is the payback period? 2. If the management accepts projects with payback period of four (4) years, will the game lounge be accepted? Why or why not? 3. What is the accounting rate of return? 4 What is the discounted payback period? If the acceptable discounted payback period is four (4) years, will it be accepted? Why or why not? What is the net present value? 7. If net present value was used to evaluate the project, will it be accepted? Why or why not? What is the profitability index? 9. What is the internal rate of return

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Decision Making And Control

Authors: Jerold Zimmerman

10th Edition

1259969495, 978-1259969492

More Books

Students also viewed these Accounting questions