The internal rate of return for project


1.Which of the following cash flows are not considered in the calculation of the initial outlay for a capital investment proposal? increase in accounts receivable cost of issuing new bonds if the project is financed by a new bond issue installation costs none of the above - all are considered

2. Zellars, Inc. is considering two mutually exclusive projects, A and B. Project A costs $95,000 and is expected to generate $65,000 in year one and $75,000 in year two. Project B costs $120,000 and is expected to generate $64,000 in year one, $67,000 in year two, $56,000 in year three, and $45,000 in year four. Zellars, Inc.'s required rate of return for these projects is 10%. The profitability index for Project B is
1.55.
1.48.
1.39.
1.33.

3. Zellars, Inc. is considering two mutually exclusive projects, A and B. Project A costs $95,000 and is expected to generate $65,000 in year one and $75,000 in year two. Project B costs $120,000 and is expected to generate $64,000 in year one, $67,000 in year two, $56,000 in year three, and $45,000 in year four. Zellars, Inc.'s required rate of return for these projects is 10%. The internal rate of return for Project B is
29.74%.
30.79%.
35.27%.
36.77%.

 

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Accounting Basics: The internal rate of return for project
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