A company has a decision to make between two investment alternatives. The company requires a 10% return on investment. Predicted data is provided below: The present value of an annuity for 6 years at 10% is 4.3553. This company uses straight-line depreciation. Required:
(a) Calculate the net present value for each investment.
(b) Calculate the payback for each investment.
(c) Which investment should this company select? Explain.
(D) What is the annual cash flow?