please solve these pratice problems Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, netoperating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 10%.-Select-%0Project A-950550150Project B -950What is Project A's IRR? Do not round intermediate calculations. Round your answer to two decimal places.-Select-%1-Select-23370305What is Project B's IRR? Do not round intermediate calculations. Round your answer to two decimal places.The reason is -Select-4220370If the projects were independent, which project(s) would be accepted according to the IRR method?360810If the projects were mutually exclusive, which project(s) would be accepted according to the IRR method?Could there be a conflict with project acceptance between the NPV and IRR approaches when projects are mutually exclusive?Reinvestment at the -Select- is the superior assumption, so when mutually exclusive projects are evaluated the -Select-approach should be used for the capital budgeting decision. Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, netoperating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 8%.0Project A -1,150Project B-1,15066026023703053290440340790

The techniques followed in the modern approach of capital budgeting are the PI, IRR, and NPV. These…

Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 10%. 3 % 0 Project A 550 150 Project B What is Project A's IRR? Do not round intermediate calculations. Round your answer to two decimal places. % -Select- -950 -950 1 2 v 370 305 What is Project B's IRR? Do not round intermediate calculations. Round your answer to two decimal places. 220 370 360 810 If the projects were independent, which project(s) would be accepted according to the IRR method? -Select If the projects were mutually exclusive, which project(s) would be accepted according to the IRR method? -Select Could there be a conflict with project acceptance between the NPV and IRR approaches when projects are mutually exclusive? The reason is -Select- Reinvestment at the -Select- is the superior assumption, so when mutually exclusive projects are evaluated the -Select- approach should be used for the capital budgeting decision.

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 21P: Your division is considering two investment projects, each of which requires an up-front expenditure...