Question

In: Finance

Compute the discounted payback statistic for Project C if the appropriate cost of capital is 6...

Compute the discounted payback statistic for Project C if the appropriate cost of capital is 6 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow –$2,900 $1,240 $1,050 $1,090 $680 $480 Discounted payback period years Should the project be accepted or rejected? Rejected Accepted

Solutions

Expert Solution

Answer :-

Cash Flow
Year Project(A) PVF@6% PV CCF
0 -2,900           1.000 -2,900.000
1 1,240           0.943    1,169.811 1,169.81
2 1,050           0.890       934.496 2,104.31
3 1,090           0.840       915.185 3,019.49
4 680           0.792       538.624 3,558.12
5 480           0.747       358.684 3,916.80
6 3,000           0.705    2,114.882 6,031.68
7 1,000           0.665       665.057 6,696.74
Discounted PBP
Project 2 + 796/915           2.870 Years

Here the Discount PBP is less than the maximum allowable period of 3 Years Hence the project is acceptable.

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8 percent and the maximum allowable discounted payback period is three years. Time: 0 1 2 3 4 5 Cash flow: –$1,000 $480 $480 $520 $300 $100 Calculate discounted payback period in years
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$2,200 $960 $840 $880 $540 $340 Should the project be accepted or rejected? accepted rejected
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$1,600 $720 $660 $700 $420 $220
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 8 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$2,200 $960 $840 $880 $540 $340
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$1,700 $760 $690 $730 $440 $240
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$1,400 $640 $600 $640 $380 $180 Should the project be accepted or rejected? accepted rejected
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7...
Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7 percent and the maximum allowable discounted payback period is three years. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project C Time: 0 1 2 3 4 5 Cash flow: –$2,400 $1,040 $900 $940 $580 $380 Should the project be accepted or rejected? Discounted payback period______ years accepted rejected
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 12...
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 12 percent and the maximum allowable discounted payback is four years. (Do not round intermediate calculations and round your final answer to 2 decimal places. If the project does not pay back, then enter a "0" (zero).) Project D Time: 0 1 2 3 4 5 Cash flow: –$12,400 $3,490 $4,460 $1,800 $0 $1,280
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 13...
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 13 percent and the maximum allowable discounted payback is four years. (Do not round intermediate calculations and round your final answer to 2 decimal places. If the project does not pay back, then enter a "0" (zero). PROJECT D: TIME               0                    1                     2                      3                4              5 Cash Flow    $ -11,800          $3,430             $4,340           $1,680             $0          $1,160 Discounted Payback Period = Should this be rejected...
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 12...
Compute the discounted payback statistic for Project D if the appropriate cost of capital is 12 percent and the maximum allowable discounted payback is four years. (Do not round intermediate calculations and round your final answer to 2 decimal places. If the project does not pay back, then enter a "0" (zero).) Project D Time: 0 1 2 3 4 5 Cash flow: –$11,000 $3,350 $4,180 $1,520 $300 $1,000 Discounted payback period _______ years Should the project be accepted or...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT