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PLEASE HELP, THANK YOU Following is information on two alternative investments being considered by Jolee Company. The company requires a 12% return from its investments.
PLEASE HELP, THANK YOU
Following is information on two alternative investments being considered by Jolee Company. The company requires a 12% 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 $(147,960) Initial investment Expected net cash flows in: Year 1 Year 2 Year 3 Year 4 Year 5 48,000 58,000 77,295 81,400 63,000 26,000 53,000 58,000 69,000 38,000 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 $ 179,325 Chart Values are Based on: i = 12 Year Cash Inflow PV Factor 1 Present Value Initial Investment Year Cash Inflow 1 Project B $ 147,960 PV Factor Present Value 2 3 2 3 4 5 4 5 = Required A Required B For each alternative project compute the profitability index. If the company can only sele choose? Profitability Index 1 Choose Denominator: Choose Numerator: Profitability Index Profitability index II 0 Project A Project B If the company can only select one project, which should it choose? 0Step by Step Solution
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