This question is based on the following information: Each of the three independent investments below has a life of 10 years. The cost of capital for the 3 investments is 14%. The PV of an annuity of P 1 for 10 years at 14% is 5.216. Amount (O) Annual cash inflows (I) Net present value (NPV) Investment A P449,400 P 100,000 ? Investment B ? 70,000 13,800 Investment C 198,208 ? 36,512 The amount of investment for investment B is A. P 351,320 B. P 351,230 C. P 350,000 D. P 315,320

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 16E
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This question is based on the following information: Each of the three independent investments below has a life of 10 years. The cost of capital for the 3 investments is 14%. The PV of an annuity of P 1 for 10 years at 14% is 5.216. Amount (O) Annual cash inflows (I) Net present value (NPV) Investment A P449,400 P 100,000 ? Investment B ? 70,000 13,800 Investment C 198,208 ? 36,512 The amount of investment for investment B is

A. P 351,320
B. P 351,230
C. P 350,000
D. P 315,320

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