Q2 please lo NPV IRR Payback 18 months Project W $100 million $100 million 15% P

Question

Q2 please

lo NPV IRR Payback 18 months Project W $100 million $100 million 15% Project X $150 million $100 million 14% 17 months Project Y $75 million $85 million 18% 12 months Which project should be approved? A Project W B Project X C Project Y D Project Z 2 BetaCo is purchasing a piece of equipment for $300,000. There are delivery cos installation costs of $30,000 and the use of the equipment will require employe S50,000 as well as an inventory of special lubricants costing $25,000. Their tax machine will be depreciated using straightline depreciation over 10 years. What investment for this capital project? A 300,000 B 350,000 C 375,000 D 425,000

Explanation / Answer

2)

Working capital $            25,000 Machinery cost $          300,000 Delivery charges $            20,000 Installation cost $            30,000 Initial investment $          375,000 Correct option is (C )

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