Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $228,000 and would yield the following annual cash flows. 11eb91e1_332f_c5f0_ad16_b70bf66ff2ff_SM1965_00 (1) Assuming that the company requires a 12% return from its investments, use net present value to determine which projects, if any, should be acquired. (2) Using the answer from part 1, explain whether the internal rate of return is higher or lower than 12% for Project C2.

Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

النسخة 22الرقم المعياري الدولي: 978-0077862275

Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

النسخة 22الرقم المعياري الدولي: 978-0077862275

تمرين 19

Phoenix Company can invest in each of three cheese-making projects: C1, C2, and C3. Each project requires an initial investment of $228,000 and would yield the following annual cash flows.

(1) Assuming that the company requires a 12% return from its investments, use net present value to determine which projects, if any, should be acquired. (2) Using the answer from part 1, explain whether the internal rate of return is higher or lower than 12% for Project C2.

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The term cash flow is usually used to de...