Exercise 11-10 (Algo) Net present value, unequal cash flows, and profitability index LO P3 Following is information on two alternative investment projects being considered by Tiger Company. The company requires a 5% return from its investments. (PV of $1. EV of $1, PVA of $1, and EVA of $1) Note: Use appropriate factor(s) from the tables provided. Initial investment Net cash flows in: Project X1 $ (92,000) Project X2 $ (144,000) Year 1 31,000 69,000 Year 2 Year 3 41,500 59,000 66,500 49,000 a. Compute each project's net present value. b. Compute each project's profitability index. c. If the company can choose only one project, which should it choose on the basis of profitability index? Complete this question by entering your answers in the tabs below. Required A Required B Required C es Compute each project's net present value. Note: Round your final answers to the nearest dollar. Net Cash Flows Present Value of 1 at 5% Present Value of Net Cash Flows Project X1 Year 1 $ 31,000 Year 2 41,500 Year 3 66,500 Totals $ 139,000 $ 0 Initial investment Net present value Project X2 Year 1 Year 2 Year 3 Totals Initial investment Net present value $ + $ 69,000 59,000 49,000 $ 177,000 $ 0 $ Required A 0 Required B > < Prev 1 of 1 Next >