Solution-Calculate the payback period for each project

Calculate the payback period for each project

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Reference no: EM133052785

Question - CAPITAL BUDGETING TECHNIQUES - Mill Industries Inc. is attempting to select the best of three mutually exclusive projects. The initial investment and after-tax cash inflows associated with these projects are shown in the following table

Cash Flows	Project A	Project B	Project C
Initial investment	P60,000	P100,000	P110,000
Cash flows for the next 5 years (at the end of each year 1 to year 5)	P20,000	P31,500	P32,500

Required -

1. Calculate the payback period for each project.

2. Calculate the Net Present Value (NPV) of each project, assuming that the firm has a cost of capital equal to 13%.

3. Calculate the Internal Rate of Return (IRR) for each project.

Reference no: EM133052785

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Calculate the payback period for each project

Reference no: EM133052785

Reference no: EM133052785

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