Perkins Corporation is considering several investment proposals, as shown below:       Investment Proposal     A B C D Investment required $ 100,000   $ 125,000   $ 75,000   $ 93,750   Present value of future net cash flows $ 120,000   $ 187,500   $ 105,000   $ 180,000       If the project profitability index is used, the ranking of the projects from most to least profitable would be:   Multiple Choice   D, B, C, A   B, D, C, A   B, D, A, C   A, C, B, D

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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Perkins Corporation is considering several investment proposals, as shown below:

 

    Investment Proposal  
  A B C D
Investment required $ 100,000   $ 125,000   $ 75,000   $ 93,750  
Present value of future net cash flows $ 120,000   $ 187,500   $ 105,000   $ 180,000  
 

 

If the project profitability index is used, the ranking of the projects from most to least profitable would be:

 

Multiple Choice
  •  

    D, B, C, A

  •  
    B, D, C, A
  •  
    B, D, A, C
  •  
    A, C, B, D
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