The company is considering two mutually exclusive projects. Both require an initial cash outlay

of UGX. $10,000,000$ each, and have a life of five years.

Year Project A Project B Project C Project D

UGX. $000$ UGX. $000$ UGX. $000$ UGX. $000$

$0(10,000)(10,000)(10,000)(10,000)$

$14,0003,5003,0002,800$

$24,0003,000(1,000)1,700$

$34,000(2,000)5,0003,500$

$44,0005,0002,000(2,000)$

$54,0005,0001,8004,800$

Required:

From the above information, calculate the following:

a$)$ Discounted and Non discounted Pay Back period $($PBP$)$ of Project A and B$.(5$ Marks$)$

b$)$ Average Rate of Return $($ARR$)$ of Project A and B$.(5$ Marks$)$

c$)$ Discounted and Non$-$ discounted Net Present Value $($NPV$)$ of Project A and B$.(5$ Marks$)$

d$)$ Internal Rate of Return $($IRR$)$ of Project A and B$.(5$ Marks$)$

e$)$ Profitability Index $($PI$)$ of all projects. $(5$ Marks$)$

f$)$ Basing on $($PI$)$ results obtained in $($e$)$ above, rank the projects in order of preference. $(5$