Abstract

This report analyses AYR Co.’s two project investment proposals, namely Aspire and Wolf, to determine each project’s future success. Based on provided projects information, the report advises Directors of AYR Co. on their planned capital expenditures. Based on some assumptions, the Net Present Value (NPV), Internal Rate of Return (IRR) and projects’ payback periods were calculated. Despite the fact that both projects have equal IRR, the project aspire has been recommended for AYR Co.’s management, due to its great cash flows compared to the project Wolf’s. However, a number of other factors to be considered has been highlighted and financial sources criticized.

Keywords: Strategic Financial Management, Capital Budgeting, Debt, Cost of Capital, Internal Rate of Return, Stock