Lapides Ltd. is a small company that is currently analyzing capital expenditure proposals for the purchase of equipment. The capital budget is limited to $250,000, which Lapides believes is the maximum capital it can raise. The financial adviser is preparing an analysis of four projects that the company is considering, as follows:

Instructions a. Calculate the cash payback period for each of the four projects. b. Calculate the net present value for each project at a cost of capital of 12%. c. Which projects, if any, would you recommend funding, and why? Take into consideration all non-financial factors

Project A Project B Project C Project D Net initial investment: $200,000 $190,000 $250,000 $210,000 Projected cash inflows: Year 1 $50,000 $40,000 $75,000 $75,000 50,000 50,000 75,000 75,000 50,000 70,000 60,000 60,000 50,000 75,000 80,000 50,000 75,000 100,000 20,000