Komfy Karz is evaluating a project (Project A) that costs $325,000 and is expected to generate $200,000 for the next two years. They are also evaluating a project (Project B) that costs $350,000 and is expected to generate $200,000 in the first year and $230,000 in the second year. Komfy's required rate of return for both projects is 13.3%. Upload a file with the following calculations: a) Calculate the NPV for both projects. b) Calculate the IRR for both projects. c) Calculate the payback period for both projects. d) Calculate the discounted payback period for both projects. e) Calculate the cross-over rate.
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- Caduceus Company is considering the purchase of a new piece of factory equipment that will cost $565,000 and will generate $135,000 per year for 5 years. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return In Excel, see Appendix C.Markoff Products is considering two competing projects, but only one will be selected. Project A requires an initial investment of $42,000 and is expected to generate future cash flows of $6,000 for each of the next 50 years. Project B requires an initial investment of $210,000 and will generate $30,000 for each of the next 10 years. If Markoff requires a payback of 8 years or less, which project should it select based on payback periods?You are responsible to manage an IS project with a 4-year horizon. The annal cost of the project is estimated at $40,000 per year, and a one-time costs of $120,000. The annual monetary benefit of the project is estimated at $96,000 per year with a discount rate of 6 percent. a. Calculate the overall return on investment (ROI) of the project. b. Perform a break-even analysis (BEA). At what year does break-even occur?
- Winview Clinic is evaluating a project that costs $52,125 and has expected net cash inflows of $12,000 per year for eight years. The first inflow occurs one year after the cost outflows, and the project has a cost of capital of 12%. b. What is the project's NPV? Its IRR? Its MIRR?a) Project Panda requires an initial investment of $560,000. The project will generate $46,000 in 2 years. After that, the project will generate 108,000 at the end of each year until the end of year 13. Using this information answer parts i), i) and i) below: i) Write down the equation that can be used to find the internal rate of return (IRR) of the project. In your equation, you must use the annuity formulas when possible. Can you advise if the rate of return is higher or lower than 12%? Provide your reason by calculating the net present value (NPV) of the project, you must use the annuity formulas when possible. Calculate the payback period in years for Project Panda. Round your answer to 2 decimal places.An IT company receives two new project proposals. Project A will cost $250,000 to develop and is expected to have an annual net cash flow of $50,000. Project B will cost $350,000 to develop and is expected to have an annual net cash flow of $60,000. Analyzing the two projects from a cashflow perspective using the payback period, which project is better? Why? Write the answers in the “Payback" tab of the attached EXCEL template. You may use the Payback Period template if you wish to. Note: Enter the discounted costs and benefits for your project below. Add and delete rows as needed. Year Costs Benefits Cumulative Costs Cumulative Benefits 1 2 3 4
- An IT company receives two new project proposals. Project A will cost $250,000 to develop and is expected to have an annual net cash flow of $50,000. Project B will cost $350,000 to develop and is expected to have an annual net cash flow of $60,000. Analyzing the two projects from a cashflow perspective using the payback period, which project is better? Why? Write the answers in the “Payback" tab of the attached EXCEL template. You may use the Payback Period template if you wish to. Note: Enter your criteria, weights, and scores in the template below Insert or clear rows and columns as needed. Double check formulas and results. Criteria Project 1 Project 2 Project 3 Project 4 Project 5 Sponsor Support Strategic Alliance Urgency Fills a market gap Sales Competition Weighted Project Scores 0.00 0 0 0 0 0There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $34,675 and is expected to generate the following cash flows: First Year Second Year Third Year Total Alpha Project $32,000 $22,000 $4,500 $58,500 Beta Project 7,000 24,000 28,010 59,010 A. Calculate the internal rate of return on both projects. Use the IRR spreadsheet function to calculate internal rate of return. Alpha Project _____% Beta Project _____% B. Make a recommendation on which one to accept. _____There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $35,506 and is expected to generate the following cash flows: First Year Second Year Third Year Total Alpha Project $32,000 $23,000 $5,500 $60,500 Beta Project 7,000 24,000 30,960 61,960 A. Calculate the internal rate of return on both projects. Use the IRR spreadsheet function to calculate internal rate of return. Alpha Project fill in the blank 1% Beta Project fill in the blank 2% B. Make a recommendation on which one to accept. Alpha .
- There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $35,017 and is expected to generate the following cash flows: First Year Second Year Third Year Total Alpha Project $32,000 $22,000 $4,500 $58,500 Beta Project 8,000 24,000 27,106 59,106 A. Calculate the internal rate of return on both projects. Use the IRR spreadsheet function to calculate internal rate of return. Alpha Project fill in the blank 1% Beta Project fill in the blank 2% B. Make a recommendation on which one to accept. .ABC Service can purchase a new assembler for $15,052 that will provide an annual net cash flow of $6,000 per year for five years. Calculate the NP of the assembler if the required rate of return is 12%. Show calculation. Would you accept/reject a project based on NPV decision criteria? Why? Based on NPV calculated in part A, determine Profitability Index (PI). Show calculation. Would you accept/reject a project based on PI decision criteria? Why?There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $34,665 and is expected to generate the following cash flows: First Year Second Year Third Year Total Alpha Project $31,500 $22,000 $4,500 $58,000 Beta Project 7,500 23,500 29,066 60,066 A. Calculate the internal rate of return on both projects. Use the IRR spreadsheet function to calculate internal rate of return. Alpha Project fill in the blank % Beta Project fill in the blank %