How do I estimate a project's percent return on shareholder's investment? I've calculated the Net Present Value, Internal Rate of Return, and Payback period for the two projects. But I'm having a hard time trying to answer how to estimate their percent return on shareholder's investments.

Capital Budgeting Case Template Cash Flow Information Initial Investment $1,931,400 Working Capita $38,000 Salvage Value $712.500 Expected Project Life [ Years) Year #1 Year #2 Year #3 Year #4 Year #5 Year #6 Year #7 Year #8 Net annual operating cash Hows $320,000 $384,000 $480,000 $565,000 $685,000 $531,000 $424.700 $340,000 Investors Cost of Capital [ Required Return) 5.0% Today Year Year End of Year Year Year Year Year Year 0 2 3 8 Initial Investment .($1931,400) Net annual operating cash flows $320.000 $384.000 148020001565 000 $685,000 $531,000 $424.700 $340,000 Working Capital ($38,000] $38,000 Salvage value of equipment $112 500 Total Net Cash Flows [$1,969,400] $320,000 $384,000 $480,000 $565,000 $685,000 $531,000 $424.700 | $490,500 x present value discount 1.000 0.870 0.756 0.658 0.572 0.497 0.432 0.376 Factor 0.327 Present Value of Cash Flows ($1,969,400) $278,261 $290.359 $315,608 $323.041 $340,566 $229,566 |$159,660 | $160,345 Net Present Value $128,006 Recommendation? Low Confidence Net Present Valu ($281635) Recommendation High Confidence Net Present Val( $537,648 Recommendation? Part 2 - Calculate the Internal Rate of Return of the Capital Investment: Internal Rate of Return 16.8%% Recommendation? Low Confidence Internal Rate of F 10.8% Recommendation? High Confidence Internal Rate of 22.3% Recommendation? Part 3 - Calculate the Payback Period of the Capital Investment: Today End of End of End of Year End of End of End of End of End of Payback Method 0 2 3 5 6 8 Cumulative Cash Flows ($1,969/400) ($1,649,400) | ($1,265.400) ($785.400] ($220.400) $464,600 $995,600 $1,420,300 |$1,910,800 Payback Year 1.3 years Low Confidence Payback Year 5.1 years High Confidence Payback Year 3.8 years Part 4 - Calculate the Modified Payback Period of the Capital Investment: End of End of End of Year End of End of End of End of End of Modified Payba Today 2 3 4 5 6 8 Cumulative Cash Flows [$1.969.400] [$1,691,139] ($1.400,780] [$1,085.172] ($762.132) ($421.566] ($192,000]|($32,339] $128,006 Payback Year 7.2 years Low Confidence Payback Year N'A years High Confidence Payback Year 5.4 yearsCapital Budgeting Case Template CashlimJnEoLmatinn _ Year 111 Year 112 Year 113 Year 114 Year 115 Year 113 Net annual operating cash flows $201,300 $253,000 $233,300 $202,500 $15?,500 $112,500 Investors Cost of Capital [Required Return] 15.0% End of End of End of End of End of End of Year Year Year Year Year Year Initial Investment Net annual operating cash flow Working Capital Salvage value of equipment Total Net Cash Flows 1: present value discount factor 1.000 0.0?0 0.?50 0.050 0.5?2 0.40? 0.432 Present Value of Cash Flows 5 [$?03,000]I $244,303 $135,041 $155.3?1 $115300 $?'0,305 $53,035 Net Present Value $03,541 Recommendation? Low Confidence Net Present Val [$20,313] Recommendation? High Confidence Net Present Val $141330 Recommendation? Part 2 - Calculate the Internal Rate of Return of the Capital Investment: Internal Rate of Return 10.4% Recommendation? Low Confidence Internal Rate of 13.3% Recommendation? High Confidence Internal Rate of 22.0% Recommendation? Part 3 - Calculate the Payback Period of the Capital Investment: End of End of End of End of End of End of Today Year Year Year Year Year Year Payback Method I] 1 2 3 4 5 5 Cumulative Cash Flows [903,000] [$501,300] I$242,?'00] [$0,400] $100,100 $353,000 $404,000 Payback Year 3.0 years Low Confidence Payback Year 3.5 years High Confidence Payback Year 2.? years Part 4 - Calculate the Modified Payback Period of the Capital Investment: End of End of End of End of End of End of Modified Payback Method Today 1 2 3 4 5 5 Cumulative Cash Flows [$?'03,000] [$530,301IE [$342,550]; [$1011.70]; [$?1.333]E $0,000 $03,541 Modified Payback Year 4.3 years Modified Low Confidence Payba N'A years Modified High Confidence Payb 4.0 years