Following is information on two alternative investments being considered by Jolee Company. The company requires a 10% 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					Project B
Initial investment		$	(177,325	)			$	(145,960	)
Expected net cash flows in:
Year 1			51,000					32,000
Year 2			51,000					45,000
Year 3			87,295					58,000
Year 4			88,400					69,000
Year 5			61,000					20,000

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?

Required A Required B For each alternative project compute the net present value. Project A Initial Investment $ 177,325 Chart Values are Based on: % Year Cash Inflow X PV Factor = Present Value 1 = 2 3 4 5 Project B Initial Investment $ 145,960 Project B Initial Investment 145,960 Year Cash Inflow X PV Factor = Present Value 1 2 = 3 II 4 5