Okta company provides the following information pertaining to its proposed projects. Project Investment Required Net Present Value Life of the project (years) Internal Rate of Return A $850,000 $269,640 7 19% В $745,000 $277,100 12 17% For the purpose of calculating NPV, the discount rate is 10%. Determine profitability Index for Project A and Project B. a. Profitability Index for project A is $0.40 and Project B is 0.37 b. Profitability Index for project A is $0.32 and Project B is 0.19 c. Profitability Index for project A is $0.32 and Project B is 0.37 d. Profitability Index for project A is $0.37 and Project B is 0.32

Okta company provides the following information pertaining to its proposed projects. Project Investment Required Net Present Value Life of the project (years) Internal Rate of Return A $850,000 $269,640 7 19% В $745,000 $277,100 12 17% For the purpose of calculating NPV, the discount rate is 10%. Determine profitability Index for Project A and Project B. a. Profitability Index for project A is $0.40 and Project B is 0.37 b. Profitability Index for project A is $0.32 and Project B is 0.19 c. Profitability Index for project A is $0.32 and Project B is 0.37 d. Profitability Index for project A is $0.37 and Project B is 0.32

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project? Year0 ($11,368,000)1 $2,112,5892 $3,787,5523 $3,300,6504 $4,115,8995. $ 4,556,424 Round to two decimal places. For year 0 , its initial investment .
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