Seaside Corporation is considering beginning drilling operations in three separate fields. Seaside decides to analyze these fields using a 13% discount rate. The estimated cash flows for each field are as follows:

REQUIRED:

a. Calculate the net present value of each field.

b. Calculate the profitability index of each field.

c. Determine the internal rate of return of each field.

d. Rank the fields from best investment to worst investment.

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East Field South Field Years Cash Flows Cash Flows West Field Cash Flows 01234567890 $(105,000) $(425,000) $(300,000) 40,000 100,000 50,000 35,000 100,000 50,000 30,000 100,000 50,000 20,000 100,000 50,000 15,000 90,000 50,000 10,000 90,000 40,000 5,000 90,000 40,000 0 40,000 40,000 0 40,000 40,000 0 20,000 40,000