Is Shaylee able to invest in all of these projects simultaneously? multiple choice No Yes 2-a. Calculate the profitability index for each project. (
Is Shaylee able to invest in all of these projects simultaneously? multiple choice No Yes 2-a. Calculate the profitability index for each project. (
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 2PA
Related questions
Question
Shaylee Corp has $2.10 million to invest in new projects. The company’s managers have presented a number of possible options that the board must prioritize. Information about the projects follows:
Project A | Project B | Project C | Project D | |||||
Initial investment | $ | 720,000 | $ | 400,000 | $ | 960,000 | $ | 1,115,000 |
Present value of future cash flows | 935,000 | 500,000 | 1,650,000 | 1,310,000 | ||||
Required:
1. Is Shaylee able to invest in all of these projects simultaneously?
multiple choice
-
No
-
Yes
2-a. Calculate the profitability index for each project. (Round your answers to 4 decimal places.)
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