The Warren Company is considering investing in two alternative projects: What is the payback for Project 1 and based on payback which Project would you choose? A) 16.00 years and Project 2 b) 4.00 years and Project 1 C) 4.00 years and Project 2 D) 5.3 years and project 1 What is the accounting rate of return (ARR) for Project 2 and based on ARR which Project would you choose? A) 33.67% and Project 1 B) 10.7% and Project 2 C) 2.33% and Project 1 D) 18.00% and Project 1 Use the following for questions 28&29. Cowell Corporation is considering an investment in new equipment costing exist155,000. The equipment will be depreciated on a straight-line basis over a five-year life and is expected to generate net cash inflows of exist45,000 the first year, exist65,000 the second year, and exist90,000 every year thereafter until the fifth year. What is the payback period for this investment? The equipment has no residual value. A) 3.44 years B) 2.04 years C) 1.72 years D) 2.50 years What is the accounting rate of return for this investment? The equipment has exist5,000 residual value. A) 49.0% B) 29.7% C) 19.4% D) 40.8% What would a project's profitability index be if the project has an internal rate of return which is equal to the company's discount rate? A) It would be 0.5. B) It would be 1.0. C) It would be 0.0. D) It cannot be determined from information provided The Warren Company is considering investing in two alternative projects: What is the payback for Project 1 and based on payback which Project would you choose? A) 16.00 years and Project 2 b) 4.00 years and Project 1 C) 4.00 years and Project 2 D) 5.3 years and project 1 What is the accounting rate of return (ARR) for Project 2 and based on ARR which Project would you choose? A) 33.67% and Project 1 B) 10.7% and Project 2 C) 2.33% and Project 1 D) 18.00% and Project 1 Use the following for questions 28&29. Cowell Corporation is considering an investment in new equipment costing exist155,000. The equipment will be depreciated on a straight-line basis over a five-year life and is expected to generate net cash inflows of exist45,000 the first year, exist65,000 the second year, and exist90,000 every year thereafter until the fifth year. What is the payback period for this investment? The equipment has no residual value. A) 3.44 years B) 2.04 years C) 1.72 years D) 2.50 years What is the accounting rate of return for this investment? The equipment has exist5,000 residual value. A) 49.0% B) 29.7% C) 19.4% D) 40.8% What would a project's profitability index be if the project has an internal rate of return which is equal to the company's discount rate? A) It would be 0.5. B) It would be 1.0. C) It would be 0.0. D) It cannot be determined from information provided