6 ! Required information Part 1 of 2 Use the following information for the Quick Study below. [The following information applies to the questions displayed below.] 1.25 points Following is information on an investment considered by Hudson Co. The investment has zero salvage value. The company requires a 9% return from its investments. Initial investment Expected net cash flows in year: Investment A1 $(370,000) eBook 100,000 130,000 123,000 10 Hint Print QS 25-11 Net present value LO P3 Compute this investment's net present value. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round all present value factors to 4 decimal places.) Cash Flow Present Value of 1 at 9% Present Value Year 1 Year 2 Year 3 Totals Amount invested Net present value 7 Part 2 of 2 Required information Use the following information for the Quick Study below. [The following information applies to the questions displayed below.] 1.25 points Following is information on an investment considered by Hudson Co. The investment has zero salvage value. The company requires a 9% return from its investments. Investment A1 $(370,000) Initial investment Expected net cash flows in year: eBook 2 3 100,000 130,000 123,000 dot Hint Print QS 25-12 Net present value, with salvage value LO P3 Assume that instead of a zero salvage value, as shown above, the investment has a salvage value of $29,000. Compute the investment's net present value. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round all present value factors to 4 decimal places.) Cash Flow Present Value of 1 at 9% Present Value Year 1 Year 2 Year 3 Totals Amount invested Net present value 00 8 Exercise 25-10 NPV and profitability Index LO P3 125 points Following is Information on two alternative Investments being considered by Jolee Company. The company requires a 12% return from Its Investments. (PV of $1, FV of $1, PVA of $1 and FVA of $1. (Use appropriate factor(s) from the tables provided.) Initial investment Expected net cash flows in year: 1 eBook Project A Project B $(188,325) $(147,968) 40,000 35,eee 50,000 57,600 87,295 61,eee 96,482 69, eee 68,000 32,600 2 2 Hint Pre a. For each alternative project compute the net present value. b. For each alternative project compute the profitability Index, if the company can only select one project, which should it choose? Complete this question by entering your answers in the tabs below. Required A Required B For each alternative project compute the net present value. Project A Initial Investment $ 180,325 Chart Values are Based on: Cash Inflow X PV Factor = Present Value | | | Year 1 1 2 2 3 4 5 Initial Investment Year Cash Inflow Project E $ $ 147,980 X PV Factor Present Value 1 2 3. = L = 4 4 5 =