Question
The following information is provided by Rojas Company: Project A Project B Project C Project D Initial investment $440,000 $202,000 $568,000 $502,000 PV of cash
The following information is provided by Rojas Company:
| Project A | Project B | Project C | Project D | |
| Initial investment | $440,000 | $202,000 | $568,000 | $502,000 |
| PV of cash inflows | $576,000 | $390,000 | $808,000 | $406,000 |
| Payback period (years) | 3.6 | 3.2 | 4.0 | 2.0 |
| NPV of project | $136,000 | $188,000 | $240,000 | ($96,000) |
What is the profitability index for Project B? (Round your answer to two decimal places.)
Question content area bottom
Part 1
A.
1.97
B.
1.26
C.
1.93
D.
1.38
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Managerial Accounting for Managers
Authors: Eric Noreen, Peter Brewer, Ray Garrison
2nd edition
978-0077403485, 77403487, 73527130, 978-0073527130
