Exercise 12-5 (Algo) Preference Ranking [LO12-5] Information on four investment proposals is given below: Investment Proposal $ (130,000) 199,500 $ 69,500 6 years D $ (2,250,000) 3,004,600 $ 754,600 6 years A B Investment required Present value of cash inflows Net present value $ (350,000) 491,800 $ 141,800 $ (110,000) 152,400 $42,400 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 Index Rank Preference A B C D