Mary is analyzing a capital budgeting project with the following data: Cost of packaging machine 5 million Annual...

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Finance

Mary is analyzing a capital budgeting project with thefollowing data:
Cost of packaging machine 5 million
Annual straight line depreciation over 5 years$1,000,000
Salvage value 200k
Working capital 5% of CF’s per year with no initial workingcapital
Operating income 1.2million with a 20% tax rate
What is the IRR, the MIRR, the NPV at a 6.35% WACC, and thepayback period?

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1 PaybackPeriod PBPOne of the most popular and widely recognized traditional methodsof evaluating capital investment proposal is the payback period Itis the number of years it takes a firm to recover its See Answer

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Mary is analyzing a capital budgeting project with thefollowing data:Cost of packaging machine 5 millionAnnual straight line depreciation over 5 years$1,000,000Salvage value 200kWorking capital 5% of CF’s per year with no initial workingcapitalOperating income 1.2million with a 20% tax rateWhat is the IRR, the MIRR, the NPV at a 6.35% WACC, and thepayback period?