Determine which proposal is the better

Assignment Help Managerial Accounting

Reference no: EM132821213

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

Project ALPHA Project BETA

Investment 123,417 155,934

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

Economic life 8 years 12 years

Annual sales revenue 65,000 78,000

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

Income tax rate 35%

Cost of capital 10%

Required - Determine which proposal is the better one based on:

a. Internal rate of return

b. Net present value

c. Profitability index

d. Discounted payback period

Reference no: EM132821213

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