Payback Period and IRR of a Cost Reduction Proposal-Differential AnalysisA light-emitting diode (LED) is a semiconductor diode that emits narrow-spectrum light. Although relatively expensive when compared to incandescent bulbs, they use significantly less energy and last six to ten times longer, with a slow decline in performance rather than an abrupt failure. Metropolitan City currently has 80,000 incandescent bulbs in traffic lights at approximately 12,000 intersections. It is estimated that replacing all the incandescent bulbs with LED will cost $43.01 million. However, the investment is also estimated to save the City $7.98 million per year in energy costs. a. Determine the payback period of converting Metropolitan City traffic lights to LEDs. Round answer to one decimal place. Answer yearsb. If the average life of an incandescent streetlight is one year and the average life of an LED streetlight is seven years, should the City finance the investment in LED's at an interest rate of five percent per year? Justify your answer. 1. Compute the internal rate of return on the project. Round to the nearest whole percent. Answer%2. Select the most appropariate answer based on computation. a.No, the City should not make the investment because the IRR of the investment in LEDs is 71.4% of the interest rate. b.Yes, the City should make the investment because the IRR of the investment in LEDs is 71.4% of the interest rate. c.No, the City should not make the investment because the IRR of the investment in LEDs is 140% of the interest rate. d.Yes, the City should make the investment because the IRR of the investment in LEDs is 140% of the interest rate.

Journalize the following transactions that occurred in september 2015 for aquamarines. no explanations are needed. identify each accounts payable and accounts receivable with the vendor or customer name. sep. 3 purchased merchandise inventory on account from shallin wholesalers, $5,000. terms 1/15, n/eom, fob shipping point. 4 paid freight bill of $80 on september 3 purchase. 4 purchased merchandise inventory for cash of $1,700. 6 returned $500 of inventory from september 3 purchase. 8 sold merchandise inventory to hermosa company, $6,000, on account. terms 2/15, n/35. cost of goods, $2,640. 9 purchased merchandise inventory on account from thomas wholesalers, $8,000. terms 2/10, n/30, fob destination. 10 made payment to shallin wholesalers for goods purchased on september 3, less return and discount. 12 received payment from hermosa company, less discount. 13 after negotiations, received a $200 allowance from thomas wholesalers. 15 sold merchandise inventory to jordan company, $2,500, on account. terms 1/10, n/eom. cost of goods, $1,050. 22 made payment, less allowance, to thomas wholesalers for goods purchased on september 9. 23 jordan company returned $400 of the merchandise sold on september 15. cost of goods, $160. 25 sold merchandise inventory to smithsons for $1,100 on account that cost $400. terms of 2/10, n/30 were offered, fob shipping point. as a courtesy to smithsons, $75 of freight was added to the invoice for which cash was paid by aquamarines. 26 after negotiations, granted a $100 allowance to smithsons for merchandise purchased on september 25. 29 received payment from smithsons, less allowance and discount. 30 received payment from jordan company, less return.