requirea: 1. Compute the project profitability index for each project. ord
Chapter2: Financial Statements, Cash Flow, And Taxes
Section: Chapter Questions
Problem 14SP
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Transcribed Image Text:Question 2 - Chapter 12 - Con x
B Chapter 12 - ACCT-2302 4WO X
* Lone Star College - Start Close x
LD- Lean Wit X
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1. Compute the project profitability index for each project.
2. In order of preference, rank the four projects in terms of net present value, project profitability index and internal rate of re-
requirea:
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
In order of preference, rank the four projects in terms of net present value, project profitability index and internal rate of
return.
es
Net Present
Value
Project
Profitability
Index
Internal Rate
of Return
First preference
Second preference
Third preference
Fourth preference
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Saved
the
Internal
Rate
Net
Present Project
Investment
Required
$160,000 $44 ,323
$135,000 $42,000
$100,000 Ş35,035
$175,000 $ 38,136
(years) of Return
18%
Project
Value
A
7
16%
20%
12
7
D
3
228
The net present values above have been 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 project profitability index for each project.
2. In order of preference, rank the four projects in terms of net present value, project profitability index and internal rate of return.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Compute the project profitability index for each project. (Round your answers to 2 decimal places.)
Project
Project Profitability
Index
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2 of 6
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MacBook Air
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