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obinson Hardware is adding a new product line that will require an investment of $1,512,000. Managers estimate that this investment will have a 10-year life and nerale net cash inflows of $330,000 the first year, $290,000 the second year, and $240,000 each year thereafter for eight years. Compute the payback period burid to one decimal place *** he payback in years is Rapp Hardware is adding a new product line that will require an investment of $1,418,000 Managers estimate that this investment will have a 10-year life and generate net cash inflows of $320,000 the first year, $280,000 the second year, and $260,000 each year thereaftor for eight years. Assume the project has no residual value. Compute the ARR for the investment Round to two places Select the formula, then enter the amounts to calculate the ARR (accounting rate of retum) for the new product lino (Round ARR to the nearest hundredth percent [two decimal places), XXX%) ARR % The IRR for each project is: Project A: Project B: is the better investment. Consider the following projects being considered by Root Products: (Click the icon to view the projects.) (Click the icon to view Present Value of $1 table.) (click the icon to view Present Value of Ordinary Annuity of S1 table.) Compute the IRR of each project, and use this information to identify the better investment More info Project A: Costs $275,000 and offers eight annual net cash inflows of $53,000 Root Products requires an annual return of 14% on investments of this nature. Project B: Costs $375,000 and offers 10 annual net cash inflows of $71,000. Root Products demands an annual return of 12% on investments of this nature. 1 ference Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 15% 16% 18% 20% Period 1 0.9900 9800 971 0962 09520943 0935 0926 0917 0909 08930877 0.870 0.862 0 847 0.833 Period 2 0 9800 961 0.943 0.925 0.907 0.890 0873 0857 0.842 0828 0797 0.769 07560743 0718 0694 Period 3 0.971 0942 0915 08890 8640 840 0.816 0794 0.772 0751 0.7120675 0658 0.6410 609 0.579 Period 4 0961 09240 888 0.855 08230.7920763 0.735 0708 0.683 0.6360592 0572 0552 0516 0482 Period 5 0 951 0 906 0 8630822 0784 0747 0.713 0681 0.650 0.621 0567 0.519 049704760437 0402 Period 6 0942088808370790 07460 7050.666 0.630 0596 0.564 0.507 0456 0432 04100370 0335 Period 7 0933 0871 0 813 0.760 0.7110 665 0.623 0.583 0547 051304520 400 0376 0354 0314 0279 Period 8 0923 0 853 07890731 06770627 0582 0540 0502 0.467 0 4040 351 0327 03050266 0233 Period 9 0914 08370 766 0703 06450.5920544 0500 0.460 0.42403610308 0284 02630 225 0.194 Period 10 0.905 08200744 0676 06140558 0.508 0463 0.422 0.386 0322 0270 02470 2270191 0.162 Period 11 0.896 0.80407220 650 0.58505270475 0.429 0.388 03500 287 0237 0215 0.1950 162 0 135 Period 12 0 887 078807010625 055704970444 0 397 0356 0319 0 2570 208 0.187 0.1680.137 0.112 Period 13 0879 0773 0.681 0.601 0.530 0.469 0.415 0.368 0.328 0290 0.229 0.182 0.163 0.1450 116 0.093 Reference Period 14 0 870 0.758 0661 0577 050504420388 0340 0299 0263 0 2050 160 01410125 0 099 0078 Period 15 0861 07430 642 0.555 0 48104170362 0315 0 275 0239 0.1830 140 0.123 0.108 0 0840065 Period 16 0853 0.7280 623 0534 04580394 0339 0292 0252 02180163 0.123 0 1070093 0071 0054 Period 17 0 844 0.71406050513 0.436 0371 0317 0270 0231 0.198 0 146 0 108 0093 0.0000060 0045 Period 18 0836 0700 0 5870494041603500 296 0260 02120 180 0.1300095 0081 0.0690051 0038 Period 19 0828 0.6860570 0.475 0396 0331 0277 0232 0194 0.164 0.116 0083 0070 0.0600013 0031 Period 20 0820 067305646456 037703120 258 0215 0.178 01490 1040073 0.06100510037 0026 Period 21 10 811 066005380439 0359 0294 0 242 0 199 0.164 0.135 0.093 0064 0053 0.014 0031 0022 Period 22 0803084705220422 0342 02780 228 0.184 0.15001230083 0056 00460038 0.026 0018 Period 23 0 795 063405070406 03260262 0211 0 170 0 138 0.11200740049 00400033 0022 0.015 Period 24 0788 0 622 04920390 0310 0.2470 197 0.158 0.125 0.1020068 0043003500280019 0.013 Period 25 0780 06100478 0375 0295 02330184 0 146 0110 0092 00590038 00300024 0.016 0010 Period 260 712 0 698 0464 8361 0281 0 2200172 0135 0.106 008400630033 002800210014 0009 Period 27 0764058604500347 0.2680 2070 161 0 125 0098 0.076 0047 0.029 0023 0.018 | 0.011 0.007 Period 28 0757 0.574 0.437 0333 0255 0 1960.150 0.116 0090 0.089 0042 0026 0.0200.0160010 0.006 Period 29 In z 583 In 12410321 243 1 185 10141 0107 23 0037 00220017 In 14 long Reference Period 18 0836 0700 0587049404160350 0296 0250 02120 1800 130 0.095 0.081 00690 051 0038 Period 19 0828 0.686 0.570 0475 0396 0331 02770232 0.194 0 1640 11600830070 0.000 0.043 0.031 Period 20 08200 673 05540456 0377 0312 0258 0215 0 1780 1490 1040073 0.061 0.051 0.037 0026 Period 21 08110660 0538 0.439 03590294 0242 0 1990 164 0.135 0.093 0.0640053 0.044 0.031 0.022 Period 22 0.8030647 0.5220422 03420 278 0.226 0184 0.150 0123 0.083 0056 0.046 0.0380026 0018 Period 23 0795 063405070406 03280262 0211 0 1700 138 0 112 0.074 0049 0.0400033 0.022 0.015 Period 24 0788 0622 0.492 390 03100247 0 197 0 158 0.126 0 10200660043 0.03500280019 0013 Period 25 078006100478 0375 0295 02330184 0.146 0.116 0.092 0059 0.038 0.0300024 0.016 0010 Period 26 0.7720598 0.464 0361 0281 0 2200172 0.135 0.106 0.084 0.053 0.033 0.026 0.021 0.014 0.009 Period 27 0764058604500347 02680207 0.161 0 125 0.098 0076 0.047 0.029 0.0230018 0.011 0.007 Period 28 10757 0.574 0437 0333 0255 0 196 0.150 0.116 0090 00690042 0.026 0.020001600100006 Period 29 0 7490.563 04240321 0243 0 185 0.141 0 107 0082 0063 0037 002200170014 0.008 0.005 Period 30 0742 05520412 308 0231 0 174 0.131 0 099 0075 0.0570033 0.0200.015 0.012 0007 0.004 Period 40 0672 04530307 0208 0.142 0097 0.067 0.046 003200220011 0005 0004 0.003 0001 0.001 Period 50 0.608 0372 02280141 008700540034 0021 0013 0.0090003 0.001 0.0010001 Reference IR Penods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Present Value of Ordinary Annuity of $1 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 15% 16% 18% 20% 0 990 0980 0971 0.962 0952 0943 09350926 0917 0 909 0 893 087708700 86208470833 1970 1942 1913 -1888 1859 1833 1808 1783 1759 1738 1 690 1 647 1626 1 605 1506 1528 2941 2884 28292775 2723 2673 2624 2577 2531 2487 24022 322 2283 2246 2174 2.106 3 62 3809 3717 3630 35463 465 3 3873312 3240 3.17030372914 2856 2798 2690 2.589 4863 4713 45804452 432942124 100 39933 890 3791 3 6053433 3352 3274 3.127 2.991 5796 5601 5417 5242 5078491747674 623 4486 4356 4 1113 889 3784368534983326 6728 6472 62306 002 5786 5582 53895 206 5033 486845644288 4160 40393.812 3 605 7652 7325 7020 6.733 8.463 6210 5971 5747 5535 5335 4.968 4 6394 487 4344 4078 3.837 8506 8.162 77867435 71086 802 65156247 5 996 5759 532849464772 4 607 4 303 4031 9471 8983 8530 8 111 7722736070246.710 6 418 6145 5650 5216 5019 4833 4494 4192 103889787 9253 8760 830678877499 7 139 6 805 6496 5938 5453 5234 11 255 10575 9954 5029 4656 4327 9385 8863 8384 7943 7536 7 161 6814 6 194 5 680 5421 5197 47934439 12134 11 348 10 635 9966 93948853 83587904 7487 7 103 642458425583 5342 4910 4533 1 Reference Period 14 13004 12 106 11 290 10563 989992958745 8244 77867367 66286.002 5724 5468 5008 4611 Period 15 13.866 12 849 1193811118 103809712 9.1088.569 8061 7606 6 811 6 142 5847 5575 5.092 4675 Period 16 14 718 1357812581 11 652 10 838 10 10619 447 8851 8 313 7.824 6974 6 265 5954 5669 5 162 4.730 Period 1715562 14 292 13.166.12 166 1127410471 9763 9.122 8544 8 022 71206373 6047 5749 5222 4775 Period 18 16 398 14992 1375412 659 11 690 10 828 10 059 9372 8 756 8201 72506 4676 128 5 818 5273 4812 Period 19 17226 156781432413.131 1208511.158 10 336 9.604 8950 8.365 736665506198 5877 5 316 4844 Period 20 18 046 16351 1487713 590 12 462 11 470 105949 818 9.129 851474696 623 6259 5929 5353 4870 Period 21 18 857 17 011 15415 14029 1282111.764 1083610017 9292 864975626 687 6312 5.973 5384 4891 Period 22 19 660 17658 1593714451 13.163 12.042 11 061 10 201 9 442 8772 764567436359 6011 5.410 4 909 Period 23 20 456 18 292 1644414857 1348912,303 11 272 10371 95808 883 7718 6.792 6 399 6044 5432 4925 Period 24 21 243 18 914 16936 15 247 13 79912650 11 46910529 9.707 8.985 7784 6835 6434 6 073 5451 4937 Period 25 22 023 1952317413 15 622 1409412783 11 654 10 675 9 823 9077 78436873 64646 097 5467 498 Period 26 22795 20.12117877 15 983 14375 13 003 11 826108109.929 9 161 78966.906 6491 6.118 5.480 4956 Period 27 23 580 20.707 18 327 16 330 14 643 13 211 11.987 10 935 10 027 92377943 6 935 6514 6.138 5.492 4964 Period 28 24 316 21 281 1876416 663 14898 13 406 12137 11051 10.116 9307 79846961 6534 6.152 5502 4970 Dalado 1000 1xE2700002 An A A 64 47 Print Done Reference w Period 18 16 398 14992 13.754 12 659 11,690108281005993728 756 8201725064676 128 5.818 5.273 4812 Period 19 17226 15678 14 324 13 134 1208511 15810338 9.604 8.950 8365 7366 6.550 6 198 5877 5316 4.844 Period 20 18.046 16351 14 877 135901246211.470 10 594 9.8189 129 851474696.623 6.259 5.929 5353 4870 Period 21 18 857 17 011 15.415 14.029 1282111 764 10 836 10 017 9292 86497562 6.687 6312 5 973 5384 4891 Period 22 19 660 17658 1593714451 13 163 12 042 11 061 10 201 944287727 645 6.743 6.359 6011 5410 4.909 Period 23 20456 18 292 1644414857 13 489 12 303 11 272 10371 9580 8883 771867926399 6044 5.432 4925 Period 24 21 243 18 914 16.936 15 247 13.79912 550 1146910529 9.707 8.985 7784 68356434 6073 5 451 4937 Period 25 22 023 19523 17 413 15 622 14094 12 783 11 654 106759 823 9.07778436.87364646 097 5467 4948 Period 26 22 795 20.121 17.877 15 983 1437513003 11 826 10 810 9 929 9.1617 896 6.906 6.491 6 118 5480 4956 Period 27 23 560 20 707 1832716 330 14643 13211 11.987 10.935 10 027 9237 7943 6.935 65146 136 5 492 4984 Period 28 24 316 21281 1876416 663 1489813 406 12137 11051 10.116 9307 79846.961 6534 6 152 5502 4970 Period 29 25 068 1 844 19 188 1698415 141 13 591 12 278 11 158 10.198 9370 8022 6 983 6551 6.166 5510 4 975 Period 30 25 808 22 396 19600 17 292 15372 137661240911 258 10 274 9427 805570036566 6177 5.517 4979 Period 40 32 835 27356 23 115 19.793 17 159 15.046 1333211925 107579779 8 244 7 1056 642 6233 5548 4.997 Period 50 39 196 31 424 25 73021 482 18 256|15.76213 801 12 233 10.962 9915 8 3047 133 6.661 6 246 55544999
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