Exercise 12-5 (Algo) Preference Ranking [LO12-5] Information on four investment proposals is given below B Investment Proposal $ (120,000) 182,000 $62,000 6 years D $ (1,820,000) 2,427,200 $ 607,200 6 years A Investment required Present value of cash inflows Net present value $ (790,000) 1,121,300 $331,300 $ (120,000) 168,300 $ 48,300 Life of the project 5 years 7 years Required: 1 Compute the profitability index for each investment proposal (Round your answers to 2 decimal places.) 2. Rank the proposals in terms of preference. Investment Profitability Proposal Rank Index Preference A B C D E