Solve the problem below. Two project proposals have been presented to XYZ Corporation. Project A requires an initial investment of Php 80,000.00 and the expected annual cash return is Php 30,000.00 for 4 years. Project B requires an initial investment of Php 60,000.00 and the expected annual cash return is Php 20,000.00 for 5 years. a. What is the payback period of each project? b. Compute for the net present value of each project if the cost of capital is 10%. c. Which project should XYZ Corporation accept? Why?

Solve the problem below. Two project proposals have been presented to XYZ Corporation. Project A requires an initial investment of Php 80,000.00 and the expected annual cash return is Php 30,000.00 for 4 years. Project B requires an initial investment of Php 60,000.00 and the expected annual cash return is Php 20,000.00 for 5 years. a. What is the payback period of each project? b. Compute for the net present value of each project if the cost of capital is 10%. c. Which project should XYZ Corporation accept? Why?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 2PB: Markoff Products is considering two competing projects, but only one will be selected. Project A...

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