Okta company provides the following information pertaining to its proposed projects. Project Investment Required Net Present Value Life of the project (years) Internal Rate of Return A $850,000 $269,640 7 19% В $745,000 $277,100 12 17% For the purpose of calculating NPV, the discount rate is 10%. Determine profitability Index for Project A and Project B. a. Profitability Index for project A is $0.40 and Project B is 0.37 b. Profitability Index for project A is $0.32 and Project B is 0.19 c. Profitability Index for project A is $0.32 and Project B is 0.37 d. Profitability Index for project A is $0.37 and Project B is 0.32

Okta company provides the following information pertaining to its proposed projects. Project Investment Required Net Present Value Life of the project (years) Internal Rate of Return A $850,000 $269,640 7 19% В $745,000 $277,100 12 17% For the purpose of calculating NPV, the discount rate is 10%. Determine profitability Index for Project A and Project B. a. Profitability Index for project A is $0.40 and Project B is 0.37 b. Profitability Index for project A is $0.32 and Project B is 0.19 c. Profitability Index for project A is $0.32 and Project B is 0.37 d. Profitability Index for project A is $0.37 and Project B is 0.32

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter12: Capital Investment Analysis

Section: Chapter Questions

Problem 3PB: Net present value method, present value index, and analysis for a service company First United Bank...

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