Question
Pool Spa Initial investment $ (173,325) $ (140,960) Net cash flows in: Year 1 48,000 39,000 Year 2 41,000 54,000 Year 3 89,295 54,000 Year
| Pool | Spa | |
|---|---|---|
| Initial investment | $ (173,325) | $ (140,960) |
| Net cash flows in: | ||
| Year 1 | 48,000 | 39,000 |
| Year 2 | 41,000 | 54,000 |
| Year 3 | 89,295 | 54,000 |
| Year 4 | 86,400 | 66,000 |
| Year 5 | 62,000 | 32,000 |
a. For each investment project compute the net present value. b. For each investment project compute the profitability index. c. If the company can only select one project, which should it choose on the basis of profitability index?
Complete this question by entering your answers in the tabs below.
- Req A
- Req B and C
b. For each investment project compute the profitability index. c. If the company can only select one project, which should it choose on the basis of profitability index?
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Auditing An International Approach
Authors: Wally Smieliauskas, Amy Kwan, Kathleen Cogliano, Catherine Barrette
8th Canadian Edition
