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I need help with all the requirements. Thank you. 5. The following table contains information about four projects in which Renkas Corporation has the opportunity

I need help with all the requirements. Thank you.

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5. The following table contains information about four projects in which Renkas Corporation has the opportunity to invest. This information is based on estimates that different managers have prepared about their potential project. liClick the icon to view the projects information.) Requirements 1. Rank the four projects In order of preference by using the a. net present value. b. project profitability Index. c. intemal rateof retum. d. payback period. a. accounting rate of return. 2. WhiGl't method{s} do you think is best for evaluating capital investment projects In general? Why? Requirement 1. ank the projects In order of preference. (5} (b) (0} id) (6} Net Present Profitability Internal Rate Payback Accounting Rate Value Index of Return Period of Return ist preferred U) C (5} (93 (13) l1 7l 2nd preferred (3) {5} (1'3) (14) (15) are preferred or (1 5) no on preferred [I :05) :ltzm Requirement 2. Select the method that corresponds to the appropriate explanation. (21) : This method indicates profitability by comparing the present value of the Investments net cash inows with the cost of the investment {already stated at its present value]. This method is superior because it incorporates the time value of money. {22) : This method helps to compare the NW across alternative investments of varying sizes. (231: This method also indicates protability and Incorporates the time value of money. This method will show us the actual rate of return being earned on the Investment by equating the present value of the net cash Inows to the Investments cost. In other words. it Is the Interest rate which brings the investments my to zero. (24} : This method will show the company how quickly it recoups Its initial investment. Th Is method will be good for screening outtltose potential Investments that are too risky because the period Is tou long. Hotvever, the period will not bethe sole criterion for accepting capital investments stripe it dOes not give the company any insight about the investments protability. Additionally, it does not incorporate the time value of money. (25) _._: This method will give the company an Indication of how protable the Investment will be. However, since It does not consider the time value of money, it is not the best indicator of profitability. This method is the only method that uses accrual accounting gures. Therefore it will help the company assess the impact of investments on the nancial statements. The other methods use net cash flows. 1.' Data Table Investment Net Present Life of Internal Rate Protability Payback Period Accounting Rate Project Required Value Project of Return Index In Years of Return A ...... $ 215,000 3 42,475 5 22 'Pi: 1.20 2.8? 1? Bi. E ...... $ 410,000 $ T2324 6 25 s, 1.10 2.9? 16 \"ii. C ...... $ 1.020.000 $ 163,012 3 19 ts 1.1-5 2.14 11 35 D ...... 5 1,515,000 $ 85,850 4 13 ti: 1.06 3.00 24 BI: ('00 OD (2)0 OD (3)0 OD (410 OD (5)0 OD (5)0 OD (700 DD 0 A O A O A O A O A O A O A O B O B 0 B O E O C O C O C O C O C O C O C O B O E! O B (3) 0 DD (9) 0 DD (10) 0 OD (111'0 DD {12) 0 DD (13) 0 DD {14) 0 DD 0 A o A o A c} A O A O A O A O C O B O B O B O B O B O B O B O C O C O C O C O C O C (15} 0 O D (16) 0 OD (171 O O D (15) O 0 D (19) O O D (20) O 0'3 O A O A O A O A O A O A O B O B O B O B O B O B O C O C O C O C O C O C (21} 0 Accounting rate of return (ARR) O Protability index (9.2) 0 Accounting rate of return {ARR} O Profitability index 0 Internal rate of return 0 Internal rateof retun'l 0 Net present value {NW} 0 Net present value {NPV} 0 Paybackperlod O Payback period (23} 0 Accounting rate of return (ARR) O Profitability index (24) 0 Accounting rate of return {ARR} O Profitability index 0 Internal rate of return 0 Internal rate of retum 0 Net present value {NPV} 0 Net present value {Nij O Paybackperiod O Payback period (25} 0 Accounting rate of return (ARR) O Profitability Index 0 lntemal rate of return 0 Net present value {NPV} 0 Payback period

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