Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 13 percent.
Year Project F Project G
0 -$ 137,000 -$ 207,000
1 59,000 39,000
2 51,000 54,000
3 61,000 91,000
4 56,000 121,000
5 51,000 136,000
a. Calculate the payback period for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
Payback period
Project F years
Project G years
b. Calculate the NPV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
Net present value
Project F $
Project G $
c. Which project, if any, should the company accept?