William Industries is attempting to choose the better of two mutually exclusive projects for expanding the fi rm’s production capacity. The relevant cash fl ows for the projects are shown in the...

William Industries is attempting to choose the better of two mutually exclusive projects for expanding the fi rm’s production capacity. The relevant cash fl ows for the projects are shown in the following table. The fi rm’s cost of capital is 15 percent. Project A Project B Initial Cash Outfl ow (CF0 ) $550,000 $358,000 Year (t) Cash Infl ows (CFt ) 1 $110,000 $154,000 2 132,000 132,000 3 165,000 105,000 4 209,000 77,000 5 275,000 55,000 a. Calculate the IRR for each of the projects. b. Assess the acceptability of each project based on the IRRs found in part (a). c. Which project is preferred, based on the IRRs found in part (a)?