The profitability index is a scale less attribute for measuring a projects benefits relative to the costs.
Question:
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 80% (10 reviews)
Since the profitability index is a modified purereturntype measure it off...View the full answer
Answered By
Ishrat Khan
Previously, I have worked as an accounting scholar at acemyhomework, and have been tutoring busines students in various subjects, mostly accounting. More specifically I'm very knowledgeable in accounting subjects for college and university level. I have done master in commerce specialising in accounting and finance as well as other business subjects.
5.00+
135+ Reviews
428+ Question Solved
Related Book For
Fundamentals of corporate finance
ISBN: 978-0470876442
2nd Edition
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
Question Posted:
Students also viewed these Corporate Finance questions
-
The profitability index is a tool for measuring a projects benefits relative to its costs. How might this help to eliminate bias in project selection?
-
Briefly explain how the profitability index is calculated and interpreted.
-
How is the project profitability index computed, and what does it measure?
-
KEA10. LO 16.3 Use the following excerpts from Fruitcake Company's financial records to determine net cash flows from investing activities. Acquired new plant assets Collected interest on investment...
-
Gulf States Manufacturing has the following data from year 1 operations, which are to be used for developing year 2 budget estimates: All depreciation charges are fixed. Old manufacturing equipment...
-
The US Environmental Protection Agency (EPA) bans use of the cancer-causing pesticide ethylene dibromide (EDB) as a fumigant for grain- and flour-milling equipment. EDB was once used to protect...
-
Carry out a full decision analysis for Classical Reproductions Ltd, using the following information: Calculation of expected profit with perfect information Prior probabilities for the various events...
-
Presented below is selected information for three regional divisions of Medina Company. Instructions (a) Compute the return on investment for each division. (b) Compute the residual income for each...
-
ABC is a manufacturer. The following balances were extracted from his books on 1 December 2010. Inventories (stocks) 1 January 2010 : Raw materials Work in progress Purchases of raw material Direct...
-
On January 2, Year 1, Argy Company's board of directors granted 12,000 stock options to a select group of senior employees. The requisite service period is three years, with one-third of the options...
-
High Tech Monopoly Co. has plenty of cash to fund any conceivable positive NPV project. Can you describe a situation in which capital rationing could still occur?
-
Define variable costs and fixed costs, and give an example of each.
-
Compare and contrast continuous and discontinuous development.
-
The carrying value of the Annuities Payable account of a college a. should be adjusted to reflect changes in actuarial assumptions such as life expectancies or yield estimates. b. should be adjusted...
-
Why is it important to understand the complexities in lines of communication?
-
Do you believe that individuals such as the defendant's spouse, priest, doctor, or lawyer should or should not be compelled to testify against the defendant? What are the arguments in favor of...
-
How can a run chart be used within a project environment?
-
Why is the definition of quality critical to the success and acceptance of a project?
-
While negotiating a possible buyout with the management of a firm, the CEO of the target starts to play hardball. He continues to add contingencies to the deal. In addition, he has recently raised...
-
In exchange for land, the company received a 12-month note on January 1. The face amount of the note is $1,000, and the stated rate of interest is 13%, compounded annually. The 13% rate is equal to...
-
Using Chueh and Swansons method, estimate the specific heat capacity of ethyl bromide at 20 C.
-
Olin Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,400 per unit; variable costs = $220 per unit; fixed costs = $3.9 million; quantity = 85,000 units....
-
Olin Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,400 per unit; variable costs = $220 per unit; fixed costs = $3.9 million; quantity = 85,000 units....
-
We are evaluating a project that costs $924,000, has an eight-year life, and has no salvage value . Assume that depreciation is straight-line to zero over the life of the project. Sales are projected...
-
ABC Hospital is one of two hospitals in the community. The Hospital offers all major specialty services (e.g. cardiology, neurology, pulmonology, etc.) The Hospital is approached by a cardiologist...
-
You obtained job-related information about the HR assistant position from O*Net. Answer the following sections based on that information. QUESTIONS: The following is the list of questions included in...
-
On January 8, the end of the first weekly pay period of the year, Regis Company's employees earned $27,760 of office salaries and $70,840 of sales salaries. Withholdings from the employees' salaries...
Study smarter with the SolutionInn App