Accounting 9706 · AS & A Level · Investment appraisal

Investment appraisal — practice question

Refer to Source B in the insert.
(a(i))[4]

Calculate the NPV.

(a(ii))[5]

Calculate the IRR.

(a(iii))[3]

Calculate the ARR.

(b)[6]

Discuss whether the directors ought to worry about the uncertainty over the estimated sales revenue. Support your answer with calculations.

(c)[7]

Advise the directors which option they should select. Justify your answer.

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