Current Attempt in Progress

New attempt is in progress. Some of the new entries may impact the last attempt grading.

Your answer is partially correct.

Orioles Custom Construction Company is considering three new projects, each requiring an equipment investment of $23,100. Each project will last for 3 years and produce the following net annual cash flows.

Year		AA		BB		CC
1		$7,350		$10,500		$13,650
2		9,450		10,500		12,600
3		12,600		10,500		11,550
Total		$29,400		$31,500		$37,800

The equipments salvage value is zero, and Oriole uses straight-line depreciation. Oriole will not accept any project with a cash payback period over 2 years. Orioles required rate of return is 12%. Click here to view PV table. (a) Compute each projects payback period. (Round answers to 2 decimal places, e.g. 15.25.)

AA		enter the number of years rounded to 2 decimal places	years
BB		enter the number of years rounded to 2 decimal places	years
CC		enter the number of years rounded to 2 decimal places	years

Which is the most desirable project?

The most desirable project based on payback period is

select a project Project AAProject BBProject CC

Which is the least desirable project?

The least desirable project based on payback period is

select a project Project BBProject AAProject CC

(b) Compute the net present value of each project. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round final answers to the nearest whole dollar, e.g. 5,275. For calculation purposes, use 5 decimal places as displayed in the factor table provided.)

AA		enter a dollar amount rounded to 0 decimal places
BB		enter a dollar amount rounded to 0 decimal places
CC		enter a dollar amount rounded to 0 decimal places

Which is the most desirable project based on net present value?

The most desirable project based on net present value is select a project Project BBProject CCProject AA.

Which is the least desirable project based on net present value?

The least desirable project based on net present value is select a project Project AAProject BBProject CC.