Problem III Capital Budgeting SEE ATTACH FILE Howell Company has the following information: Project 1 Project 2 Project3 Number of years 5 10 15 Amount of annual cash inflow $10,000.00

Problem III – Capital Budgeting SEE ATTACH FILE

Howell Company has the following information:

Project 1 Project 2 Project3

Number of years 5 10 15

Amount of annual cash inflow $10,000.00 B $5,000.00

Required initial investment A $30,000.00 $32,000.00

Minimum desired rate of return 8% 12% 8%

Net present value $0 $3,901.20 C

Given:

Present value factor for an ordinary annuity at 8% and 5 periods 3.9927

Present value factor for an ordinary annuity at 8% and 15 periods 8.5595

Present value factor for an ordinary annuity at 12% and 10 periods 5.6502

Present value of one at 8% and 5 periods 0.6806

Present value of one at 8% and 15 periods 0.3152

Present value of one at 12% and 10 periods 0.3220

Required

Determine the missing amounts. Ignore income taxes

Please show your work step by step!

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Problem III – Capital Budgeting
Howell Company has the following information:
Project 1
Project 2
Project3
Number of years
5
10
15
Amount of annual cash inflow
$10,000.00
B
$5,000.00
Required initial investment
A
$30,000.00
$32,000.00
Minimum desired rate of return
8%
12%
8%
Net present value
$0
$3,901.20
C
Given:
Present value factor for an ordinary annuity at 8% and 5 periods              3.9927
Present value factor for an ordinary annuity at 8% and 15 periods             8.5595
Present value factor for an ordinary annuity at 12% and 10 periods            5.6502
Present value of one at 8% and 5 periods                                0.6806
Present value of one at 8% and 15 periods                               0.3152
Present value of one at 12% and 10 periods                              0.3220
Required
Determine the missing amounts. Ignore income taxes
Please show your work step by step!

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