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Capital Budgeting - Payback, NPV, PI, IRR
Discounted Cash flow (DCF) methods:
NPV (Net Present Value) method
IRR (Internal Rate of Return) method
Profitability index
A) Payback Period:
Payback time or payback period is the time it will take to recoup, in the form of cash inflows from
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Capital budgeting
264478 Good Foods, Inc: Calculate payback period, NPV, IRR, PI, MIRR USE THE FOLLOWING DATA FOR THE NEXT EIGHT PROBLEMS:
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Payback period, IRR, and NPV
Calculate payback period for each investment; Calculate IRR for each investment and calculate NPV for each investment.
Which investment should Yu-Ham take, why? (negative values in time zero).
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Capital Budgeting
The payback period is 4 years + 4,125/12,000 = 4.34 years or 4 years ( to closet year)
b. what is the projects discounted payback period?
In discounted payback, we first calculate the discounted cash flows.
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Payback, NPV, IRR
Calculate the payback period for the proposed investment.
b.) Calculate the net present value (NPV) for the proposed investment.
c.)
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Caledonia: calculate payback period, NPV, IRR, and ranking conflict
203645 Caledonia: calculate payback period, NPV, IRR, and ranking conflict I do not understand the NPV, or IRR. I have to answer these questions in an excel spreadsheet.
File is attached.
12.
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Accounting: Capital budgeting and Decision Making
index 0.56
Payback period >10 Years
Worst case scenario
Net present value (NPV) ($610,451.11)
IRR -6.45%
Profitability index 0.39
Payback period >10 Years
Worst case scenario
Net present value (NPV) ($275,440.29
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Discuss characteristics of NPV and the role it plays in capital investment decision making.
This is done by discounting the cash flows using the cost of capital as the discounting rate.
Thus we calculate NPV as Present Value of cash flows - initial investment.
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IRR, MIRR, and Discounted Cashflow
435808 IRR, MIRR, and Discounted Cashflow ** Please see the attached file for the data **
Calculate payback, internal rate of return (IRR), modified internal rate of return (MIRR), and net present value (NPV), and make a recommendation whether the
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Cost of Capital Calculations
NPV = Net Present value of all cash flows associated with the project 6047.76
To calculate IRR, we know that at IRR the net present value of the project is zero, so we have
30000 = PVIFA(5years, r)*10000
So we have PVIFA(5years