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Sunland Company is considering two capital investment proposals. Estimates regarding each project are provided below: Project Nuts Project Sour $400000 $600000 34000 50000 Initial investment

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Sunland Company is considering two capital investment proposals. Estimates regarding each project are provided below: Project Nuts Project Sour $400000 $600000 34000 50000 Initial investment Annual net income Net annual cash inflow 110000 135000 Estimated useful life 5 years 6 years Salvage value 0 0 The company requires a 10% rate of return on all new investments, Present Value of an Annuity of 1 Periods 9% 10% 12% 5 3.89 3.791 3.696 3.605 6 4.486 4.355 4.231 4.111 The annual rate of return for Project Soup is The company requires a 10% rate of return on all new investments. Present Value of an Annuity of 1 Periods 9% 10% 11% 12% 5 3.89 3.791 3.696 3.605 6 4.486 4.355 4.231 4.111 The annual rate of return for Project Soup is O 55%. O 27.5% 8.5%. 17%

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