Find maximum allowable payback and discounted payback

Reference no: EM131797440

Question: Suppose your firm is considering investing in a project with the accompanying cash flows, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively.

Time: 0 1 2 3 4 5

Cashflow -$175,000 -$65,800 $94,000 $41,000 $122,000 $81,200

Choose any one of the capital budgeting decision methods, evaluate this project and decide whether the project should be accepted or not based on the capital budgeting method you use. Please show how you calculate a variable: NVP

Reference no: EM131797440

Questions Cloud

Determine the amounts of other comprehensive income : Determine the amounts of other comprehensive income and comprehensive income for 2010. Net income for 2010 is $35,150

Find the value of the test statistic : Find the value of the test statistic. Assume that the population variances are equal and that the test is conducted at the 5% significance level.

Compute the actual return on the plan assets : Erikson Company sponsors a defined benefit pension plan. Compute the actual return on the plan assets in 2010

Post the journal entry and adjusting entry to the accounts : post the journal entry and adjusting entry to the accounts involved and show their balances after adjustments

Find maximum allowable payback and discounted payback : Suppose your firm is considering investing in a project with the accompanying cash flows, that the required rate of return on projects of this risk class.

Market failure to serious environmental harm : Which of the following ways can lead market failure to serious environmental harm?

Income and substitution effects : I would like to know how can I show the income and substitution effects assuming that the consumer's demand for good B is perfectly inelastic to price changes.

Economic and cultural globalization : The political consequences of economic and cultural globalization include foreign intervention in domestic affairs of developing countries, local conflicts

Why it would be inappropriate to do a chi-square analysis : All the tourists visiting the Republic of Maldives from 2009 to 2013 were tallied.Explain why it would be inappropriate to do a chi-square analysis of this dat

User Account

All Pages