Question
Thomas Company is considering two mutually exclusive projects. The firm, which has a 12% cost of capital, has estimated its cash flows as shown in
Thomas Company is considering two mutually exclusive projects. The firm, which has a 12% cost of capital, has estimated its cash flows as shown in the following table.
| Year | Project A | Project B |
| 0 (Initial investment) | $130,000 | $85,000 |
| 1 | 35,000 | 40,000 |
| 2 | 35,000 | 35,000 |
| 3 | 45,000 | 30,000 |
| 4 | 50,000 | 10,000 |
| 5 | 55,000 | 5,000 |
Calculate the XNPV and XIRR for each project on the basis of the following dates:
Period 0 = September 1, 2016
Period 1 = November 10, 2016
Period 2 = June 30, 2017
Period 3 = August 14, 2017
Period 4 = December 31, 2017
Period 5 = April 12, 2018
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Real Life Money An Honest Guide To Taking Control Of Your Finances
Authors: Clare Seal
1st Edition
1472272293, 978-1472272294
