Oxford Company has limited funds available for investment and must ration the funds among four competing...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Oxford Company has limited funds available for investment and must ration the funds among four competing projects. Selected information on the four projects follows: Project Investment Required Present value Life of the Internal of Cash Inflows Project Rate of (years) Return A $ 150,000 $ 229,323 7 22% B $ 120,000 $ 202,000 12 21% $ 100,000 $ 160,035 7 20% D $ 162,000 $ 238,136 3 16% The net present values should be computed using a 10% discount rate. The company wants your assistance in determining which project to accept first, second, and so forth. Required: 1. Compute the profitability index for each project. 2. In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the profitability index for each project. (Round your answers to 2 decimal places.) Project Profitability Index A B C D < Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return. First preference Second preference Third preference Fourth preference Net Present Value Profitability Index Internal Rate of Return < Required 1 Required 2 > Oxford Company has limited funds available for investment and must ration the funds among four competing projects. Selected information on the four projects follows: Project Investment Required Present value Life of the Internal of Cash Inflows Project Rate of (years) Return A $ 150,000 $ 229,323 7 22% B $ 120,000 $ 202,000 12 21% $ 100,000 $ 160,035 7 20% D $ 162,000 $ 238,136 3 16% The net present values should be computed using a 10% discount rate. The company wants your assistance in determining which project to accept first, second, and so forth. Required: 1. Compute the profitability index for each project. 2. In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the profitability index for each project. (Round your answers to 2 decimal places.) Project Profitability Index A B C D < Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 In order of preference, rank the four projects in terms of net present value, profitability index, and internal rate of return. First preference Second preference Third preference Fourth preference Net Present Value Profitability Index Internal Rate of Return < Required 1 Required 2 >
Expert Answer:
Posted Date:
Students also viewed these accounting questions
-
Mrs Anh Thuy is a 43 year old lady admitted following an incidence of blurred vision, numbness down the right side and a sharp pain in her head. A neighbour found her on the ground unable to move or...
-
Discuss how the various stages of economic development affect the demand for industrial goods.
-
Verify the following calculations: (a) 3.1415( 0.0011) = 1.77243( 0.00031) (b) log[3.1415 ( 0.0011)] = 0.49714 ( 0.00015) (c) antilog[3.141.5 ( 0.0011)] = 1.3852( 0.0035) 103 (d) ln[3.1415 (...
-
Some members of the financial community allege that corporate managers manage their companys reported accounting results. Discuss the possible motivations behind this behavior.Can you envision a...
-
In Problem 12.9 on page 424, an agent for a real estate company wanted to predict the monthly rent for one bedroom apartments, based on the size of the apartments. Perform a residual analysis for...
-
Is the 1880 SF "laundry ordinance" constitutional? Make at least two hundred to three hundred words. questions: 1. What is the statue exactly? 2. What's the classification? 3. Does Yick Wo fit the...
-
On January 1, Elias Corporation issued 10% bonds with a face value of $50,000. The bonds are sold for $46,000. The bonds pay interest semiannually on June 30 and December 31, and the maturity date is...
-
A graduating senior with a major in accounting is considering the following job offers. a. From a "Big Six" CPA firm. b. From a small local CPA firm. c. From a large corporation with training to...
-
The understanding of internal control that relates to a financial statement assertion should be used to do all of the following except a. Determine inherent risk for that assertion. b. Identify types...
-
Let $S^{2}$ denote a sphere of unit radius, centered at the origin of $\mathbb{R}^{3}$. What is the group of transformations that leave it invariant? Next, let $S_{(1)}^{2}$ be a sphere of unit...
-
Which of the following internal control procedures would an entity most likely use to assist in satisfying the completeness assertion related to long-term investments? a. Senior management verifies...
-
Define the following terms: a. Ethics. b. Ethical commitment. c. Ethical awareness. d. Ethical competency.
-
Strickland Company sells inventory to its parent, Carter Company, at a profit during 2020. Carter sells one-third of the inventory in 2020. In the consolidation worksheet for 2021, assuming Carter...
-
The words without recourse on an indorsement means the indorser is: a. not liable for any problems associated with the instrument. b. not liable if the instrument is dishonored. c. liable personally...
-
Number the following activities from 1 to 3 in the order corresponding to the typical flow of cost in a CPA firm. Record the time worked on a client project by professional staff. Record the...
-
At December 31, 2019, the end of its fiscal year, Kelly Metal Products Corporation collected the following data for 2019: Required Prepare a schedule of cost of goods manufactured and sold for Kelly...
-
Brooklyn Company reported the following amounts for October: Use Excel to prepare a schedule of cost of goods manufactured for October. Beginning raw materials inventory. Beginning work-in-process...
Study smarter with the SolutionInn App