Determine internal rate of return

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Question - Two investment proposals have been made and the following data thereon are given:

Project ALPHA Project BETA

Investment P123,417 P155,934

Depreciable assets included in the investment figure 60,000 72,000

Economic life 8 years 12 years

Annual sales revenue P65,000 P78,000

Annual out-of-pocket operating cost 36,000 42,500

Income tax rate 35%

Cost of capital 10%

Required -

a. Determine internal rate of return?

b. Determine net present value?

c. Determine profitability index?

d. Determine discounted payback period?

Reference no: EM132830736

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