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ABC Enterprises is evaluating three investment options, each with different cash flows: Project A: Initial Investment: $(200,000) Cash Inflows: $50,000, $70,000, $75,000, $60,000 over four

ABC Enterprises is evaluating three investment options, each with different cash flows:

  • Project A:
    • Initial Investment: $(200,000)
    • Cash Inflows: $50,000, $70,000, $75,000, $60,000 over four years
  • Project B:
    • Initial Investment: $(220,000)
    • Cash Inflows: $60,000, $80,000, $70,000, $65,000 over four years
  • Project C:
    • Initial Investment: $(240,000)
    • Cash Inflows: $70,000, $90,000, $80,000, $75,000 over four years

Requirements:

  1. Calculate the NPV for each project assuming a discount rate of 10%.
  2. Determine the PI for each project.
  3. Prepare a projected balance sheet for the selected project at the end of Year 4.

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