How can information be used in the decision making process

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Reference no: EM132510928

Alexander Inc. is considering four proposals for the construction of new facilities. The Accountant is supposed to evaluate four proposals.

                                              Proposal 1                         Proposal 2                     Proposal 3                           Proposal 4

Payback period                 3 years                               4 years                   4 years                       7 years

Net present value            $80,000                              $178,000                 $166,000                    $308,000

Internal rate of return          12%                                 14%                     11%                                13%

Accrual accounting

rate of return                         8%                                    6%                          4%                            7%

Required:

Question 1: How can this information be used in the decision making process for the new facilities? Does it cause any confusion? Which is the best proposal in your overview and why?

Reference no: EM132510928

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