I need help finding the Profitability index for each project (D) using Excel a. Project AProject Bb. Project AProject Bc. Project AProject Bd. Project AProject Be.$$3.44 years2.21years78,560.9511,694.2416.7226.311.879 X3.160 XProject A%% Consider the following two mutually exclusive projects:Cash Flow (A)Cash Flow (B)-$ 419,000-$ 37,00019,80013,90015,60012,400Year0123447,00059,00076,000534,000The required return on these investments is 11 percent.a. What is the payback period for each project?Note: Do not round intermediate calculations and round your answersto 2 decimal places, e.g., 32.16.b. What is the NPV for each project?Note: Do not round intermediate calculations and round your answersto 2 decimal places, e.g., 32.16.c. What is the IRR for each project?Note: Do not round intermediate calculations and enter your answersas a percent rounded to 2 decimal places, e.g., 32.16.d. What is the profitability index for each project?Note: Do not round intermediate calculations and round your answersto 3 decimal places, e.g., 32.161.e. Based on your answers in (a) through (d), which project will you finallychoose?

Profitability Index: It represents a measure used in capital budgeting to show the attractiveness…

Answered: I need help finding the Profitability…

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I need help finding the Profitability index for each project (D) using Excel

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter26: Capital Investment Analysis

Section: Chapter Questions

Problem 2CMA: Staten Corporation is considering two mutually exclusive projects. Both require an initial outlay of...

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Question

I need help finding the Profitability index for each project (D) using Excel

a. Project A
Project B
b. Project A
Project B
c. Project A
Project B
d. Project A
Project B
e.
$
$
3.44 years
2.21
years
78,560.95
11,694.24
16.72
26.31
1.879 X
3.160 X
Project A
%
%

Consider the following two mutually exclusive projects:
Cash Flow (A)
Cash Flow (B)
-$ 419,000
-$ 37,000
19,800
13,900
15,600
12,400
Year
0
1
2
3
4
47,000
59,000
76,000
534,000
The required return on these investments is 11 percent.
a. What is the payback period for each project?
Note: Do not round intermediate calculations and round your answers
to 2 decimal places, e.g., 32.16.
b. What is the NPV for each project?
Note: Do not round intermediate calculations and round your answers
to 2 decimal places, e.g., 32.16.
c. What is the IRR for each project?
Note: Do not round intermediate calculations and enter your answers
as a percent rounded to 2 decimal places, e.g., 32.16.
d. What is the profitability index for each project?
Note: Do not round intermediate calculations and round your answers
to 3 decimal places, e.g., 32.161.
e. Based on your answers in (a) through (d), which project will you finally
choose?

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