An organization has identified the following projects for possible investment The net present values of the projects are as follows: Benefits (Shs) 20,000,000 5,000,000 2,000,000 30,000,000 10,000,000 Costs (Shs) 10,000,000 1,000,000 500,000 10,000,000 20,000,000 Project A C There is a limit on capital expenditure budget of only Kshs.12,000,000 Required: ) Advice the management on the project to be funded.

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter9: Capital Budgeting Techniques
Section: Chapter Questions
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An organization has identified the following projects for possible investment
The net present values of the projects are as follows:-
Benefits (Shs)
20,000,000
5,000,000
2,000,000
30,000,000
Costs (Shs)
10,000,000
1,000,000
500,000
10,000,000
20,000,000
Project
10,000,000
There is a limit on capital expenditure budget of only Kshs. 12,000,000
Required:
a)
Advice the management on the project to be funded.
l<BCDE
Transcribed Image Text:An organization has identified the following projects for possible investment The net present values of the projects are as follows:- Benefits (Shs) 20,000,000 5,000,000 2,000,000 30,000,000 Costs (Shs) 10,000,000 1,000,000 500,000 10,000,000 20,000,000 Project 10,000,000 There is a limit on capital expenditure budget of only Kshs. 12,000,000 Required: a) Advice the management on the project to be funded. l<BCDE
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