AUGUST 26 LOGISTICS (PTY) LTD is in WINDHOEK, Namibia and is part of the Food Manufac Industry. AUGUST 26 LOGISTICS (PTY) LTD has 30 total employees across all its locations and generates $4.89 million in sales (USD). (Employee's figure is estimated, Sales figure is modelled AUGUST 26 LOGISTICS (PTY) LTD is considering two projects. The projects are similar in natu are expected to both operate for four years. Due to unavailability of funds to undertake both, only project can be accepted. The cost of capital is 12% and depreciation is charged on the straight-li basis. The following information is available: Profit after depreciation Project A Project B Initial investment 46 000 46 000 Year 1 6. 6 500 4 500 Year 2 3 500 2 500 Year 3 13 500 4 500 Year 4 (1 500) 14 500 Estimated scrap value at the end of year 4 4 000 4 000 Calculate the Payback period Proposal A to the nearest whole number
AUGUST 26 LOGISTICS (PTY) LTD is in WINDHOEK, Namibia and is part of the Food Manufac Industry. AUGUST 26 LOGISTICS (PTY) LTD has 30 total employees across all its locations and generates $4.89 million in sales (USD). (Employee's figure is estimated, Sales figure is modelled AUGUST 26 LOGISTICS (PTY) LTD is considering two projects. The projects are similar in natu are expected to both operate for four years. Due to unavailability of funds to undertake both, only project can be accepted. The cost of capital is 12% and depreciation is charged on the straight-li basis. The following information is available: Profit after depreciation Project A Project B Initial investment 46 000 46 000 Year 1 6. 6 500 4 500 Year 2 3 500 2 500 Year 3 13 500 4 500 Year 4 (1 500) 14 500 Estimated scrap value at the end of year 4 4 000 4 000 Calculate the Payback period Proposal A to the nearest whole number
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:AUGUST 26 LOGISTICS (PTY) LTD is in WINDHOEK, Namibia and is part of the Food Manufacte
Industry. AUGUST 26 LOGISTICS (PTY) LTD has 30 total employees across all its locations and
generates $4.89 million in sales (USD). (Employee's figure is estimated, Sales figure is modelled).
AUGUST 26 LOGISTICS (PTY) LTD is considering two projects. The projects are similar in nature
are expected to both operate for four years. Due to unavailability of funds to undertake both, onlyc
project can be accepted. The cost of capital is 12% and depreciation is charged on the straight-line
basis. The following information is available:
Profit after depreciation
Project A
Project B
Initial investment
46 000
46 000
Year 1
6 500
4 500
Year 2
3 500
2 500
Year 3
13 500
4 500
Year 4
(1 500)
14 500
Estimated scrap value at the end of year 4
4 000
4 000
Calculate the Payback period Proposal A to the nearest whole number
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