please help me complete part a & b
Exercise 11-10 NPV and profitability index LO P3 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 $(172,325) Project B $(156,960) bok Initial investment Expected net cash flows in Year 1 Year 2 Year 3 Year 4 Year 5 36,000 40,000 74.295 91,400 64,000 40,000 57,000 51,000 65,000 24,000 rences 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 $ 172,325 Chart Values are Based on: % Year Cash Inflow X PV Factor - Present Value For each alternative project compute the net present value. Project A Initial Investment $ 172,325 Chart Values are Based on: Year Present Value PV Factor = 0.9090 Cash Inflow X 36,000 x 40,000 0,000 X 74,295 x 91,400 64,000 x 0.6830 62,426 Present value of cash inflows Present value of cash outflows Net present value rint rences Present Value 36,360 1 2 3 Project B Initial Investment $ 156,960 Year Cash Inflow X PV Factor - 4 0,000 0.9090 = 57,000 X 51,000 4 65,000 0.6830 = 24,000 44,395 5 Present value of cash inflows Present value of cash outflows Net present value Prev Exercise 11-10 NPV and profitability index LO P3 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 $(172,325) Project B $(156,960) Initial investment Expected net cash flows in Year 1 Year 2 Year 3 Year 4 36,000 40,000 74,295 91.400 64,000 40,000 57,000 51,000 65.000 24.000 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 profitability Index. If the company can only select one project, which should it choose? Profitability Index Choose Numerator: Choose Denominator: Profitability Index Present value of net cash flows initial investment - Profitably index Project A TS 172,325 = Project B 1569601 If the company can only select one project, which should it choose? Project A 0.00 000
