Question: Dip N' Dunk Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows:

Dip N' Dunk Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows:

a. Determine the present value index for each proposal.
b. Which location does your analysis support? Explain.

Total present value of net cash flow Less amount to be invested Net present value Ft. Collins $607,600 620,000 $(12,400) Boulder $624,000 600,000 24,000

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