Current Attempt in Progress Sheridan Corp. management is evaluating two independent projects. The costs and expected cash flows are given in the following table. The cost of capital is 12.84 percent. Year A B 0 -$265,930 -$382,916 1 109,500 148,190 2 109,500 142,830 3 109,500 149,500 4 109,500 128,800 5 109,500 119,800 4. a. Calculate the projects' NPV. (Enter negative amounts using negative sign eg. -45.25. Do not round discount factors. Round other intermediate calculations and final answer to O decimal places, e.g. 1,525.) The NPV of project A is $ and project B is $ b. Calculate the projects' IRR. (Round answer to 2 decimal places, e.g. 15.25%) The IRR of Project A is % and Project B is c. Which project should be chosen based on NPV? Based on IRR? Is there a conflict? Sheridan should choose There is ✓ between the NPV and IRR decisions. d. If you are the decision maker for the firm, which project or projects will be accepted? will be accepted. eTextbook and Media Search %. Attempts 0 of 3used Submit AnQuer
Current Attempt in Progress Sheridan Corp. management is evaluating two independent projects. The costs and expected cash flows are given in the following table. The cost of capital is 12.84 percent. Year A B 0 -$265,930 -$382,916 1 109,500 148,190 2 109,500 142,830 3 109,500 149,500 4 109,500 128,800 5 109,500 119,800 4. a. Calculate the projects' NPV. (Enter negative amounts using negative sign eg. -45.25. Do not round discount factors. Round other intermediate calculations and final answer to O decimal places, e.g. 1,525.) The NPV of project A is $ and project B is $ b. Calculate the projects' IRR. (Round answer to 2 decimal places, e.g. 15.25%) The IRR of Project A is % and Project B is c. Which project should be chosen based on NPV? Based on IRR? Is there a conflict? Sheridan should choose There is ✓ between the NPV and IRR decisions. d. If you are the decision maker for the firm, which project or projects will be accepted? will be accepted. eTextbook and Media Search %. Attempts 0 of 3used Submit AnQuer
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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