sent value indexTasty Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows:Total present value of net cash flowAmount to be investedNet present valueDes Moines Cedar Rapids$192,610$214,080(187,000)$5,610(223,000)$(8,920)a. Determine the present value index for each proposal. Round your answers for the present value index to two decimal places.Total present value of net cash flowAmount to be investedDes MoinesCedar RapidsPresent value indexb. Which location does your analysis support? (If both present value indexes are the same, either location will grade as correct.), because the net present value index is1.

Part 2: Explanation:Step 1: Calculate the present value index for each proposal.The present value…

Answered: sent value index Tasty Doughnuts has…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter15: Capital Investment Analysis

Section: Chapter Questions

Problem 15.12E

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Present Value Index Tasty Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows: Des Moines Cedar Rapids Total present value of net cash flow $252,720 $274,550 Amount to be invested (243,000) (289,000) Net present value $9,720 $(14,450) a. Determine the present value index for each proposal. Round your answers for the present value index to two decimal places. Des Moines Cedar Rapids Total present value of net cash flow Amount to be invested $ $ Present value index b. Which location does your analysis support? (If both present value indexes are the same, either location will grade as correct.) v, because the net present value index is 1.
Present value index Tasty Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows: Des Moines Cedar Rapids Total present value of net cash flow $321,300 $342,160 Amount to be invested Net present value (306,000) (364,000) $15,300 $(21,840) a. Determine the present value index for each proposal. Round your answers for the present value index to two decimal places. Des Moines Cedar Rapids Total present value of net cash flow Amount to be invested Present value index b. Which location does your analysis support? (If both present value indexes are the same, either location will grade as correct.) because the net present value index is 1.
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