Project Bono Project Edge Project Clayton Capital investment $168,000 $183,750 $202,000 Annual net income: Year 1 14,700
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Question:
Project Bono Project Edge Project Clayton Capital investment $168,000 $183,750 $202,000
Annual net income:
Year 1 14,700 18,900 28,350
2 14,700 17,850 24,150
3 14,700 16,800 22,050
4 14,700 12,600 13,650
5 14,700 9,450 12,600
Total $73,500 $75,600 $100,800
Depreciation is computed by the straight-line method with no salvage value. The company’s cost of capital is 15%. (Assume that cash flows occur evenly throughout the year.)
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(a)
Compute the cash payback period for each project. (Round answers to 2 decimal places, e.g. 10.50.)
Project Bono years
Project Edge years
Project Clayton years
Related Book For
Valuation The Art and Science of Corporate Investment Decisions
ISBN: 978-0133479522
3rd edition
Authors: Sheridan Titman, John D. Martin
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