Requirement 2. What is the maximum acceptable price to pay for each project? Maximum Acceptable Price Project A Project B Requirement 3. What is the profitability index of each project? (Round to two decimal places, X.XX.) Select the formula, then enter the amounts to calculate the profitability index of each project. + = Profitability Index Project A . = Project B = Requirement 2. What is the maximum acceptable price to pay for each project? Maximum Acceptable Price Project A Project B Requirement 3. What is the profitability index of each project? (Round to two decimal places, X.XX.) Select the formula, then enter the amounts to calculate the profitability index of each project. + = Profitability Index Project A . = Project B = Reference Use the NPV method to determine whether Preston Products should invest in the following project Project A: Costs $270,000 and offers eight annual net cash inflows of $52,000. Preston Prody Project B: Costs $390,000 and offers 9 annual net cash inflows of $77,000. Preston Products (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Valu Read the requirements. Net present value of Project A Calculate the NPV of Project B. Project B: Net Cash Annuity PV Factor Present Value Years Inflow (i=12%, n=9) 1-9 Present value of annuity 0 Investment Present Value of Ordinary Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 15% 16% 18% 20% 3 8% % % % % % % Period 1 0.990 0.90 0.971 0.962 0.952 0.943 0.935 0.926 0.317 0.909 0.853 0.077 0.870 0.862 0.947 0.833 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.738 1.600 1.600 1.647 1.626 1.605 1.566 1.528 Period 3 2.9412.084 2.629 2.775 2.723 2.673 2.624 2577 2.531 2.487 2.402 2.322 2283 2.246 2.174 2. 108 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.814 2855 2.798 2.690 2.589 Period 5 4.853 4.7134.580 4.452 4.529 4212 4.1003993 3.890 3.791 3.605 3.433 3352 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.767 4.623 4.486 4.365 4.111 3.889 3.784 3.989 3.784 3.686 3.605 3.498 3.325 Period 7 6.728 6.472 6.230 6.002 5.788 5.582 5.389 5206 5.133 4.868 4.564 4.288 4.160 4.288 4160 4.099 3.112 3.605 Period 8 7.652 7.3257.620 6.733 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.437 4.344 | 4.078 3.837 Period 9 8.56 8.1627.788 7.435 7.108 6.802 6.515 6 247 5.995 5.759 5.328 4.946 4.7724.607 4.303 4.031 Period 10 9.471 8.963 0.530 8.111 7.722 7.360 7.0246.710 6.418 8.145 5.6505.216 5.019 4.033 4.494 4.192 Period 11 10.368 9.7878.253 8.760 8.306 7.887 7.499 7.139 6.905 6.495 5.938 5.453 5.234 5.029 4.656 4.327 period 12 11.255 10.575 9.954 9.385 9.863 8.384 7.943 7.536 7.161 5.814 6.194 5.560 5.421 5.1974.793 4,439 Period 13 12.134 11.348 10.6359.986 9.394 8.853 8.358 7.904 7.487 7.103 6.424 5.842 5.583 5.342 4.810 4.583 Period 14 13.0104 12.106 11.296 10.563 9.899 9.295 8.7458244 7.786 7.367 6.628 6.002 5.724 5.4685.00 84.611 Period 15 13.965 12.849 11.938 11.110 10.380 9.712 9.108 8.559 8.061 7.603 8.811 6.142 5.847 5.575 5.092 | 4.675 Period 16 14.718 13.578 12.561 11.652 10.838 10.1089.447 8.851 8.313 7.824 6.9746.265 5.954 5.669 5.1624.730 Period 17 15.582 14.292 13.188 12.163 11.274 10.4771 9.783 9.122 8.544 0.022 7.120 6.373 6.047 5.749 5.222 4.775 Period 18 16.398 14.992 13.754 12.669 11.690 10.828 10.059 9.372 8.756 9.201 7.250 6.467 6.128 5.818 5.2734.812 period 19 17.226 15.678 14.324 13.134 12085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 6.198 5.877 5.316 4,844 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 10.564 9.818 9.129 9.514 7.469 6.623 6.259 5.929 5.353 4.870 Period 21 18.857 17.011 15.415 14.029 12.821 11.764 10.836 0.017 9.292 8.649 7.562 6.687 6.312 5.973 5.3844,891 Period 22 19.860 17.658 15.937 14.451 13.163 12.042 11.0610.201 9.442 0.772 7.845 6.743 6.359 3.011 5.410 4,909 Period 23 20.456 18.292 16.444 14.857 13.489 12.303) 11.272 0.371 9.580 8.883 7.718 6.792 6.399 6.044 5.432 4.925 Period 24 21.243 18.914 16.938 15.247 13.799 12.560 11.469 10.529 9.707 0.985 7.784 6.035 6.4346.073 5.451 | 4.907 Period 25 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 7.843 6.873 6.464 | 6.097 5.467 4.948 Period 26 72.795 20.121 | 17.877 15.963 14.375 13.003) 11.26 0.810 9.929 9.161 7.8566.906 6.491 5.118 5.480 4.965 Net present value of Project B Requirement 2. What is the maximum acceptable price to pay for each project? Maximum Acceptable Price Project A Project B Requirement 3. What is the profitability index of each project? (Round to two decimal places, X.X Select the formula, then enter the amounts to calculate the profitability index of each project. Project A Project B ( Print Done Reference Use the NPV method to determine whether Preston Products should invest in the following projects: Projec! A: Costs $270,000 and offers eight annual net cash inflows of $52,000. Preston Products red Project B: Costs $390,000 and offers 9 annual net cash inflows of $77,000. Preston Products demar (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ol Present Value of $1 Read the requirements. Net present value of Project A Calculate the NPV of Project B. Project B: Net Cash Annuity PV Factor (i=12%, n=9) Present Value Years Inflow 1-9 Present value of annuity 0 Investment Net present value of Project B Periods 1% 2% 3% 4 4% 5% 6% 7% 8% % 9% 10% 12% 14% 15% 16% 18% 20% % % % Period 1 0.000 0.000 0.371 0.962 0.962 0.543 0.335 0.025 0.917 0.909 0.893 0.877 0.970 0.862 0.847 0.833 Period 2 0.9800.961 0.943 0.925 0.9070.890 0.873 0.857 ( 0.842 0.826 0.797 0.769 0.756 0.743 0.7180.694 Period 3 0.971 0.942 0.315 0.889 0.864 0.840 0.916 0.794 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 Period 4 0.961 0.924 0.888 0.855 0.623 0.792 0.763 0.735 0.708 0.683 0.638 0.592 0.572 0.552 0.516 0.432 Periods 0.961 0.9C6 0.863 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.567 0.519 0.497 0.476 0.437 0.402 Period 0.942 0.068 0.937 0.790 0.743 0.705 0.586 0.69 0.598 0.564 0.507 0.458 0.432 0.410 0.370 0.335 Perlod 7 0.933 0.871 0.813 0.760 0.7110.665 0.623 0.583 0.547 0.513 0.452 0.400 0.376 0.354 0.3140.279 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.404 0.361 0.327 0.305 0.283 0.233 Period 9 0.914 0.837 0.766 0.703 0.6450.592 0.544 0.500 0.460 0.424 0.361 0.308 0.284 0.263 0.225 0.194 Period 10 0.905 0.820 0.744 0.676 0.614 0.568 0.508 0.463 0.422 0.386 0.322 0.270 0.247 0.227 0.191 0.162 Period 11 0.898 0.804 0.722 0.650 0.585 0.527 0475 0.429 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 Period 12 0.887 0.788 0.701 0.625 0.567 0.497 0444 0.397 0.397 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.112 Period 13 0.679 0.773 0.861 0.601 0.530 0.469 0.415 0.368 0.328 0.290 0.229 0.182 0.163 0.145 0.116 0.093 Period 14 0.870 0.758 0.661 0.577 0.505 0.442 0.505 0.442 0.388 0.388 0.340 0.340 0.299 0.263 0.205 0.160 0.141 0.125 0.299 0.078 Period 15 0.881 0.743 0.842 0.565 0.481 0.417 0.362 0.315 0.275 0.239 0.183 0.140 0.123 0.108 0.064 0.035 Period 16 0.853 0.728 0.623 0.534 0.4580.394 0.339 0.292 0.252 0.218 0.163 0.123 0.107 0.003 0.071 0.054 Period 17 0.844 0.714 0.005 0.513 0.435 0.371 0.317 0.317 0.270 0.231 0.198 0.146 0.108 0.093 0.000 0.000 0.045 Period 18 0.838 0.700 0.587 0.494 0.4160,350 0.296 0.250 0.2120,1800.130 0.095 0.081 0.069 0.061 0.038 Period 19 0.828 0.686 0.570 0.475 0.39 0.331 0.277 0.232 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 Period 20 0.820 0.673 0.554 0.456 0.377 0.312 0.258 0.215 0.178 0.149 0.104 0.073 0.061 0.051 0.007 0.025 Period 21 0.811 0.660 0.538 0.439 0.359 0.294 0.242 0.199 0.1640.135 0.093 0.064 0.053 0.044 0.001 0.022 Period 22 0.803 0.847 0.522 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.063 0.068 0.046 0.038 0.028 0.018 Period 23 0.795 0.634 0.507 0.408 0.3260.262 0.211 0.170 0.138 0.112 0.074 0.049 0.040 0.003 0.022 0.015 Period 24 0.788 0.622 0.492 0.390 0.310 0.247 0.197 0.158 0.126 0.102 0.063 0.043 0.035 0.028 0.019 0.013 Period 25 0.780 0.610 0.478 0.375 0.295 0.233 0.184 0.184 0.146 0.116 0.002 0.069 0.008 0.030 0.024 0.016 0.010 Period 26 10.772 0.598 0.464 0.361 0.281 / 0.220 0.172 0.135 0.106 0.084 0.063 0.003 0.026 0.021 0.014 0.009 Requirement 2. What is the maximum acceptable price to pay for each project? Maximum Acceptable Price Project A Project B Requirement 3. What is the profitability index of each project? (Round to two decimal places, X.XX.) Select the formula, then enter the amounts to calculate the profitability index of each project Project A Project B + Print Done 1 Use the NPV method to determine whether Preston Products should invest in the following projects: Project A: Costs $270,000 and offers eight annual net cash inflows of $52,000. Preston Products requires an annual return of 14% on investments of this nature. : Costs $390,000 and offers 9 annual net cash inflows of $77,000. Preston Products demands an annual return of 12% on investments of this nature (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Project Read the requirements. Net present value of Project A Calculate the NPV of Project B. AX Requirements Net Cash Present Project B: Years 1-9 Present value of annuity Annuity PV Factor (12%, n=9) Inflow Value 1. What is the NPV of each project? Assume neither project has a residual value. Round to two decimal places. 2. What is the maximum acceptable price to pay for each project? 3. What is the profitability index of each project? Round to two decimal places. 0 Investment Net present value of Project B Requirement 2. What is the maximum acceptable price to pay for each project? Maximum Print Done Acceptable Price Project A A Project B Requirement 3. What is the profitability Index of each project? (Round to two decimal places, X.XX.) Select the formula, then enter the amounts to calculate the profitability index of each project. = Profitability Index Project A Project B