Business, 22.05.2020 18:58 luigiguitar8668

Wildhorse Company is considering two capital investment proposals. Estimates regarding each project are provided below:
Project Soup Project Nuts
Initial investment $400000 $600000
Annual net income 44000 60000
Net annual cash inflow 120000 149000
Estimated useful life 5 years 6 years
Salvage value 0 0
The company requires a 10% rate of return on all new investments.
Present Value of an Annuity of 1
Periods 9% 10% 11% 12%
5 3.890 3.791 3.696 3.605
6 4.486 4.355 4.231 4.111
The annual rate of return for Project Soup is:.
a. 60.0%.
b. 22.0%.
c. 30.0%.
d. 11.0%.

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Wildhorse Company is considering two capital investment proposals. Estimates regarding each project...

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