Fonics Corporation is considering the following three competing investment proposals: Aye Bee Cee Initial investment required $62,000 $74,000 $95,000 Net present value Internal rate of return $10,000 $8,000 $12,000 15% 17% 18% Using the project profitability index, how would the above investments be ranked (highest to lowest)? A. Aye, Bee, Cee B. Aye, Cee, Bee C. Cee, Bee, Aye D. Bee, Cee, Aye

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter15: Capital Investment Analysis
Section: Chapter Questions
Problem 15.3.1P
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Fonics corporation is considering the following three copeting investment proposals solution this question

Fonics Corporation is considering the following three competing investment
proposals:
Aye
Bee
Cee
Initial investment required $62,000 $74,000 $95,000
Net present value
Internal rate of return
$10,000 $8,000
$12,000
15%
17%
18%
Using the project profitability index, how would the above investments be ranked
(highest to lowest)?
A. Aye, Bee, Cee
B. Aye, Cee, Bee
C. Cee, Bee, Aye
D. Bee, Cee, Aye
Transcribed Image Text:Fonics Corporation is considering the following three competing investment proposals: Aye Bee Cee Initial investment required $62,000 $74,000 $95,000 Net present value Internal rate of return $10,000 $8,000 $12,000 15% 17% 18% Using the project profitability index, how would the above investments be ranked (highest to lowest)? A. Aye, Bee, Cee B. Aye, Cee, Bee C. Cee, Bee, Aye D. Bee, Cee, Aye
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