• Use the following information to complete the project:
  • This project's cash flows are

Time	0	1	2	3	4	5
Cash Flow	-$221,500	-$94,100	$135,425	$68,000	$204,000	$99,225

• The required rate of return for this project is 16%
• Maximum allowable payback and discount payback statistics for the firm are 3 and 4 years, respectively
• The firm has a capital structure of 75% equity, 5% preferred stock, and 20% debt
• The firm's before-tax cost of equity is 17.5%, its cost of preferred stock is 12%, and its cost of debt is 15%
• The firm's debt interest is fully tax deductible
• The firm's tax rate is the standard corporate tax rate
• Based on the above information, calculate the following capital budgeting decision methods
  • NPV
  • Payback
  • Discounted Payback
  • IRR
  • PI
  • Firm-wide WACC
• Evaluate this project for each capital budgeting decision method to determine if the project should be accepted or rejected (note: determine the feasibility of the project for EACH method)
• Make a final project acceptance or rejection proposal using key finance concepts from the course to support your proposal*
• Prepare a two to three (2 - 3) page (maximum) report listing each method, your calculations and acceptance or rejection determinations for each method, and your final proposal
• Calculations should be legible, concise, and accurate in your report
• Presentation of your report should be clean, free from grammatical errors and typing mistakes, and appear professional. The quality of your final report should be one you would submit to your manager at your own organization or your client.
• Your final proposal should incorporate financial concepts learned from this course. Your proposal should be at least 200 words in length and include concepts from EACH module as support for your proposal. You are telling the firm WHY it should accept or reject the project beyond what the decision methods suggest.
• Be sure your project is of professional quality including a title page, being easy to read and understand, and free from spelling and grammatical errors
  • Your project should be of the same quality as a financial professional would submit to their manager or client
• Narratives, write-up, and/or verbal explanations are required for this project
  • See above for commentary expectations
• A summary is required for this project. Follow the above instructions regarding final proposal expectations.