Considering two projects for inclusion in its capital budget

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Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 9%. 0 1 2 3 4 Project A -1,100 650 415 260 310 Project B -1,100 250 350 410 760 What is Project A's payback? Round your answer to four decimal places. Do not round intermediate calculations. years What is Project A's discounted payback? Round your answer to four decimal places. Do not round intermediate calculations. years What is Project B's payback? Round your answer to four decimal places. Do not round intermediate calculations. years What is Project B's discounted payback? Round your answer to four decimal places. Do not round intermediate calculations. years.

Reference no: EM131967537

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