Following is information on two alternative investments being considered by Jolee Company. The company requires a 8% 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.) Project A $(179,325) Project B $(155,960) Initial investment Expected net cash flows in: Year 1 Year 2 Year 3 Year 4 Year 5 48,000 56,000 84,295 44,000 60,000 62,000 76,000 37,000 96,400 66,000 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 $ 179,325 Initial Investment Chart Values are Based on: 8 Year 1 !! x x N Cash Inflow 48,000 56,000 84,295 96.400 66,000 PV Factor 0.9259 0.8573 0.7938 0.7350 0.6805 >>> 3 Present Value 44,443 48,008 66,913 70,854 44,913 275,131 X = 4 X 5 $ Present value of cash inflows Present value of cash outflows Net present value 275,131 179,325 95,806 Initial Investment Year 1 X Project B S Cash Inflow 44,000 60,000 62,000 76,000 37,000 155,960 PV Factor 0.9259 0.8573 0.7938 0.7350 2 3 Present Value 40,739 51,438 49,216 55,860 25,179 222,432 4 5 0.6805 $ $ Present value of cash inflows Present value of cash outflows Net present value 222,432 155,960 66,472 For each alternative project compute the profitability index. If the company can only select one project, which should it choose? Profitability Index Choose Choose Numerator: 1 Denominator: Present value of net cash flows Initial investment Project $ A 179,325 Project $ B 155,960 If the company can only select one project, which should it choose? Profitability Index Profitability index 0.00 = 0.00 Project A