Edelman engineering is considering including two pieces of

Question

Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year’s capital budget. The projects are independent. The cash outlay for the truck is $17,100 and that for the pulley system is $22,430. The firm’s cost of capital is 14%. After-tax cash flows, including depreciation, are as follows:

Year                Truck                 Pulley

1                      $5,100                        $7,500

2                      5,100                          7,500

3                      5,100                          7,500

4                      5,100                          7,500

5                      5,100                          7,500

Calculate the IRR, the NPV, and the MIRR for each project, and indicate the correct accept–reject decision for each.