Kaleb Konstruction, Inc., has the following mutually e company has historically used a three-year cutoff for pr percent. Year Project F Project G $130,000 62,500 47,500 57,500 $200,000 42,500 57,500 87500 123

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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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 10
percent.
Year
Project F
Project G
$130,000
62,500
47.500
57,500
52,500
47,500
$200,000
42,500
57,500
87,500
117,500
132,500
1.
3.
5.
a. Calculate the payback period for both projects. (Do not round intermediate
calculations and round your answers to 2 decimal places, e.g., 32.16.)
b. Calculate the NPV for both projects. (Do not round intermediate calculations and
round your answers to 2 decimal places, e.g.., 32.16.)
c. Which project, if any, should the company accept?
a. Project F
Project G
b. Project F
years
years
Project G
C.
<Prev
6 of 6
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Transcribed Image Text:Saved 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 10 percent. Year Project F Project G $130,000 62,500 47.500 57,500 52,500 47,500 $200,000 42,500 57,500 87,500 117,500 132,500 1. 3. 5. a. Calculate the payback period for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. Calculate the NPV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g.., 32.16.) c. Which project, if any, should the company accept? a. Project F Project G b. Project F years years Project G C. <Prev 6 of 6 e here to search
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