Bakasha Limited has estimated the expected Project Year 2 3 4 5 200 (500) 200 (400) 100 200 300 200 2 100 100 100 500 (a) (i) (ii) (iii) All figures are in GH¢°000 Required Rank these projects in order of acceptability using: Payback Net present value at 20% cost of capital Profitability Index (4 marks) (8 marks) (4marks)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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8:07
Sales in quantity and value including total value.
Production in quantities.
Material usage in quantities
Material purchases in quantity and value, including total value.
(i)
(ii)
(iii)
(iv)
QUESTION TWO
Bakasha Limited has estimated the expected cash flows for two possible projects
Project Year
3
5
(500) 200
(400) 100
200
300
200
200
2
100
100
100
500
All figures are in GH¢*000
Required
Rank these projects in order of acceptability using:
Payback
Net present value at 20% cost of capital
Profitability Index
(а)
(4 marks)
(8 marks)
(4marks)
(i)
(ii)
(iii)
Explain briefly two advantages and two disadvantages of the payback. (4 marks)
(20 MARKS)
(b)
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Transcribed Image Text:8:07 Sales in quantity and value including total value. Production in quantities. Material usage in quantities Material purchases in quantity and value, including total value. (i) (ii) (iii) (iv) QUESTION TWO Bakasha Limited has estimated the expected cash flows for two possible projects Project Year 3 5 (500) 200 (400) 100 200 300 200 200 2 100 100 100 500 All figures are in GH¢*000 Required Rank these projects in order of acceptability using: Payback Net present value at 20% cost of capital Profitability Index (а) (4 marks) (8 marks) (4marks) (i) (ii) (iii) Explain briefly two advantages and two disadvantages of the payback. (4 marks) (20 MARKS) (b) Scanned with CamScanner
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