Swifty Company is considering two capital investment proposals. Estimates regarding each project are provided below: Initial investment Annual net income Net annual cash inflow Estimated useful life Salvage value Periods 5 6 Project Soup $220000 18000 66000 5 years 0 The company requires a 10% rate of return on all new investments. 9%. 11%. 12%. 10%. Project Nuts $420000 46000 102000 6 years Present Value of an Annuity of 1 9% 10% 11% 12% 3.89 3.791 3.696 3.605 4.486 4.355 4.231 4.111 0 The internal rate of return for Project Nuts is approximately
Swifty Company is considering two capital investment proposals. Estimates regarding each project are provided below: Initial investment Annual net income Net annual cash inflow Estimated useful life Salvage value Periods 5 6 Project Soup $220000 18000 66000 5 years 0 The company requires a 10% rate of return on all new investments. 9%. 11%. 12%. 10%. Project Nuts $420000 46000 102000 6 years Present Value of an Annuity of 1 9% 10% 11% 12% 3.89 3.791 3.696 3.605 4.486 4.355 4.231 4.111 0 The internal rate of return for Project Nuts is approximately
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Subject- account

Transcribed Image Text:Swifty Company is considering two capital investment proposals. Estimates regarding each project are provided below:
Initial investment
Annual net income
Net annual cash inflow
Estimated useful life
Salvage value
5
Project Soup
$220000
6
18000
66000
Ⓒ9%.
11%.
O 12%.
O 10%.
5 years
Present Value of an Annuity of 1
Periods 9% 10% 11% 12%
3.89 3.791 3.696 3.605
4.486 4.355 4.231 4.111
0
Project Nuts
$420000
46000
The company requires a 10% rate of return on all new investments.
102000
6 years
0
The internal rate of return for Project Nuts is approximately
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