Oxford Company has limited funds available for investment and must ration the funds among four competing projects. Selected information on the four projects follows: Present Investment Value of Project Required Cash Inflows. A $ 269,323 S 242,000 $ 200,035 $ 278,136 B C D $ 180,000 $ 130,000 $ 100,000 $ 160,000 Life of the Project (years) 7 12 7 3 Internal Rate of Return 15% 20% 19% 18% The net present values should be computed using a 10% discount rate. The company wants your assistance in determining which project to accept first, second, and so forth. Required: 1. Compute the profitability index for each project. ► 2. In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return.

Following is information on two alternative investment projects being considered by Tiger Company. The company requires a 4% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Initial investment Project X1 $ (80,000) Project X2 $ (120,000) Net cash flows in: Year 1 25,000 60,000 Year 2 Year 3 35,500 50,000 60,500 40,000 a. Compute each project's net present value. b. Compute each project's profitability index. c. If the company can choose only one project, which should it choose on the basis of profitability index? Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute each project's net present value. Net Cash Flows Present Value of Present Value of Net 1 at 4% Cash Flows Project X1 Year 1 $ 25,000 Year 2 35,500 Year 3 60,500 0.8890 Totals $ 121,000 $ 0 Initial investment (80,000) Net present value $ (80,000) Project X2 Year 1 Year 2 Year 3 Totals…

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Year 0 ($100,000)-Project Outlay (The bracket indicates a negative figure) Year 1               Year 2          Year 3              Year 4         Year 5 $ 18,000             $ 18,000      $18,000           $18,000      $ 18,000    Assume that cash flows are reinvested at the rate of 10%, compounded annually. Calculate the Modified Internal Rate of Return (MIRR) on this project.  (Note that n=5)  a 18.96%  b 18%  c 15.98%  d 19.2%

The management of Riker Inc. is exploring five different investment opportunities. Information on the five projects under study follow Project Number Investment required Present value of cash inflows at a 10% discount rate Net present value Life of the project Project 1 2 3 4 5 Profitability Index 1 2 3 $(390,000) $(330,000) $(350,000) 478,490 396,950 $ 88,490 $ 66,950 6 years 3 years First preference Second preference 433,190 $ (83,190) 5 years The company's required rate of return is 10%; thus, a 10% discount rate has been used in the preceding present value computations. Limited funds are available for investment, and so the company cannot accept all of the available projects. Third preference Fourth preference Fifth preference 4 $(330,000) Required: 1. Compute the profitability Index for each investment project. (Round your answers to 2 decimal places.) 300, 100 $ 29,900 12 years 5 $(480,000) 562,860 $82,860 6 years 2. Rank the five projects according to preference, in terms of (a)…

Oxford Company has limited funds available for investment and must ration the funds among the four competing projects shown below: Project InvestmentRequired PresentValue of Cash Inflows Life oftheProject(years) InternalRateof Return A $ 170,000 $ 329,323 7 12% B $ 118,000 $ 302,000 12 17% C $ 105,000 $ 260,035 7 16% D $ 165,000 $ 338,136 3 15% The net present values above have been computed using a 10% discount rate. Required: Compute the profitability index for each project. In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return

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A company is evaluating three possible investments. The following information is provided by the​ company:     Project A Project B Project C Investment $238,000 $54,000 $238,000 Residual value 0 30,000 40,000 Net cash​ inflows:       Year 1 70,000 30,000 100,000 Year 2 70,000 21,000 70,000 Year 3 70,000 17,000 80,000 Year 4 70,000 14,000 40,000 Year 5 70,000 0 0   What is the payback period for Project​ A? (Assume that the company uses the straight−line depreciation​ method.) (Round your answer to two decimal​ places.)         A. 1.8 years   B. 2.4 years   C. 5.00 years   D. 3.4 years

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