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Questions are at the bottom of chart containing data
Sheet1
| Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Nurse Triage Salaries | $ 523,800 | $ 549,990 | $ 577,490 | $ 606,364 | $ 636,682 | $ 668,516 |
| Forecasted ER Cost Reductions | $ 400,000 | $ 800,000 | $ 848,000 | $ 900,577 | $ 955,512 | $ 1,013,798 |
| New IT Specialist’s Salary | $ 150,000 | $ 154,500 | $ 159,135 | $ 163,909 | $ 168,826 | $ 173,891 |
| Costs of Facility Renovations | $ 30,000 | $ – 0 | ||||
| Necessary Capital Equipment Purchases | $ 117,000 | $ 3,510 | ||||
| Net Cash Flow: | ||||||
| Present Values of Net Cash Flows: | ||||||
| Net Present Value: | ||||||
| IRR: | ||||||
| MIRR: | ||||||
| Payback Period (# years): | ||||||
| Discounted Payback Period (# years): | ||||||
| Questions: | ||||||
| 1. Determine the cash inflows and outflows for each year. | ||||||
| 2. Evaluate the capital project by calculating the following metrics: | ||||||
| a. net present value (NPV) | ||||||
| b. internal rate of return (IRR) | ||||||
| c. modified internal rate of return (MIRR) | ||||||
| d. payback period | ||||||
| e. discounted payback period | ||||||
| 3. Indicate whether the project is acceptable, assuming Jiranna has a corporate policy of not accepting projects that take more than 3.5 years to pay for themselves, and assuming an 11% cost of capital. |
