Java Corporation is trying to select the best investment from among four alternatives. Each alternative involves an initial outlay of $100,000. Their cash shows follow:
Year A B C D
1 $10,000 $50,000 $25,000 $0
2 20,000 40,000 25,000 0
3 30,000 30,000 25,000 45,000
4. 40,000 0 25,000 55,000
5. 50,000 0 25,000 60,000
Evaluate and rank each alternative based on:
a. payback period
b net present value (use a 10% discount rate)
c. internal rate of return
Show and explain all calculations