Year 0 -20,000 Project 1 Project 2 Project 3 Project 4 Project 5 -20,000 -20,000 -20,000 -20,000 Year 1 4000 5000 2000 2000 5000 Year 2 3000 4000 3000 5000 5000 Year 3 2000 12,000 4000 9000 5000

SWFT Individual Income Taxes
43rd Edition
ISBN:9780357391365
Author:YOUNG
Publisher:YOUNG
Chapter7: Deductions And Losses: Certain Business Expenses And Losses
Section: Chapter Questions
Problem 40P
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Hi there,

I am working on this problem. Can you please show me each step in solving this question without using excel? I am trying to figure out how to calculate the payback period for each project and also how do I calculate the IRR for each project?

Riley Ltd. has the following 5 investment projects to choose from, the company needs to select one project. 

Year 0
-20,000
Project 1 Project 2 Project 3 Project 4 Project 5
-20,000 -20,000 -20,000
-20,000
Year 1
4000
5000
2000
2000
5000
Year 2
3000
4000
3000
5000
5000
Year 3
2000
12,000
4000
9000
5000
Transcribed Image Text:Year 0 -20,000 Project 1 Project 2 Project 3 Project 4 Project 5 -20,000 -20,000 -20,000 -20,000 Year 1 4000 5000 2000 2000 5000 Year 2 3000 4000 3000 5000 5000 Year 3 2000 12,000 4000 9000 5000
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