Home / Questions / Kaleb Konstruction Inc has the following mutually exclusive projects available The company...
Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 11 percent. |
Year | Project F | Project G | ||
0 | –$ | 144,000 | –$ | 214,000 |
1 | 55,500 | 35,500 | ||
2 | 54,500 | 50,500 | ||
3 | 64,500 | 94,500 | ||
4 | 59,500 | 124,500 | ||
5 | 54,500 | 139,500 | ||
Required: |
(a) |
Calculate the payback period for both projects. (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) |
Payback period | |
Project F | years |
Project G | years |
(b) |
Calculate the NPV for both projects. (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) |
Net present value | |
Project F | $ |
Project G | $ |
(c) | Which project should the company accept? |
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