Information on four investment proposals is given below:Investment required.Present value of cash inflowsNet present value.Life of the projectInvestment Profitability.IndexProposalA8CDA$ (790,000)1,121,300$ 331,300RankPreference5 yearsRequired:1. Compute the profitability index for each investment proposal. (Round your answers to 2 decimal places.)2. Rank the proposals in terms of preference.Investment Proposal$ (120,000)182,000$ 62,000B$ (120,000)168,300$ 48,3007 years6 yearsD$ (1,820,000)2,427,200$ 607,2006 years

SOLUTION : -1. Calculation of the profitability index for each investment proposal : -…

Information on four investment proposals is given below: Investment required Present value of cash inflows Net present value Life of the project Investment Profitability Proposal Index A B C D A $ (790,000) 1,121,300 $ 331,300 Rank Preference 5 years Investment Proposal C $ (120,000) 182,000 $ 62,000 6 years Required: 1. Compute the profitability index for each investment proposal. (Round your answers to 2 decimal places.) 2. Rank the proposals in terms of preference. B $(120,000) 168,300 $ 48,300 7 years D $ (1,820,000) 2,427,200 $ 607,200 6 years

Information on four investment proposals is given below: Investment required Present value of cash inflows Net present value Life of the project Investment Profitability Proposal Index A B C D A $ (790,000) 1,121,300 $ 331,300 Rank Preference 5 years Investment Proposal C $ (120,000) 182,000 $ 62,000 6 years Required: 1. Compute the profitability index for each investment proposal. (Round your answers to 2 decimal places.) 2. Rank the proposals in terms of preference. B $(120,000) 168,300 $ 48,300 7 years D $ (1,820,000) 2,427,200 $ 607,200 6 years

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Compute the MIRR statistic for Project I if the appropriate cost of capital is 12 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project I Time: 0 1 2 3 4 Cash flow: −$11,000 $5,330 $4,180 $1,520 $2,000 What is the MIRR %
Internal rate of return and modified Internal rate of return. Quark Industries has three potential projects, all with an initial cost of $2,200,000. Given the discount rate and the future cash flow of each project in the following table, what are the IRRs and MIRRs of the three projects for Quark Industries? What is the IRR for project M7 % (Round to two decimal places.) GITE
Information on four investment proposals is given below: Investment required Present value of cash inflows Net present value Life of the project 4 Required: 1. Compute the project profitability index for each investment proposal. (Round your answers to 2 decimal places.) 2. Rank the proposals in terms of preference. Investment Proposal A BUD C Project Profitability Index Investment Proposal A D $(106,000) $(116,000) $(86,000) $(144,000) 142,040 178,640 118,680 213,120 $36,048 $ 62,640 $ 32,680 $ 69,120 5 years 7 years years 6 years Rank Preference:
Moates Corporation has provided the following data concerning an investment project that it is considering: Initial investnent Annual cash flow Expected life of the project Discount rate $380,000 $124,000 per year 4 years 10% Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using the tables provided. The net present value of the project is closest to: Multiple Cholce $12.956 $380,000 $/256,000) K 69°F Mostly cloudy A E W 10 re to search DELL 近 ...
i need the answer quickly
i
Compute the IRR statistic for Project F. The appropriate cost of capital is 12 percent. Note: Do not round intermediate calculations and round your final answer to 2 decimal places. Project F Time: 0 Cash flow: -$ 11,000 1 $ 4,100 2 $ 4,930 3 4 $ 2,270 $ 2,900 IRR % Should the project be accepted or rejected? (Click to select) ✓
Calculate all three (see Problem 8.11) PW indexes (at i = 15%) for the following projects described in the table. What reason(s) are there to prefer one index over another? Each project is to be evaluated over 10 years. Project A B First cost(s) $30K $30K in year 0, $20K in year 1 $30K 10K O&M/year Revenue 13К 46K 20K 17K 53K Salvage 20K
A project has cash flows of –$148,000, $43,000, $87,000, and $51,500 for Years 0 to 3, respectively. The required rate of return is 11 percent. Based on the internal rate of return of Blank 1 percent for this project, you should Blank 2 the project. Enter your answer in the first blank as a percent rounded to 2 decimal places, e.g., 32.16. Also enter either "accept" or "reject" in the second blank.
1.Assuming you are facing with making a decision on a large capital investment proposal. the capital investment amount is $ Estimated the study period is years .The annual revenue at the end of each year is $ and the estimated annual year-end expense is $ starting in year Assuming a market value at the end year is $ and the benchmark rate is 10%, please answer the following questions: 1.Please design this investment project to fill the proper number in blank space to let the project is feasible in economics( 2.To give the cash flow chart of the project(
Information on four investment proposals is given below. Investment required Present value of cash inflows Net present value Life of the project Required: 1 Compute the profitability index for each investment proposal. Note: Round your answers to 2 decimal places. 2. Rank the proposals in terms of preference Investment Profitability Proposal Index A B C D S (150,000) 211,800 $61,500 Rank Preference 5 years Investment Proposal $(80,000) 110,400 $ 30,400 7 years $ (160,000) 241,600 $ 81,600 6 years D $ (910,000) 1.214,500 $ 304,500 6 years
Find internal rate of return of a project with an initial cost of $43,000, expected net cash inflows of $9,550 per year for 8 years, and a cost of capital of 9.35%. Round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72. A. 15.64% B. 14.90% C. 13.70% D. 14.75% E. 11.17%