Details of this Paper

Oxford Company has limited funds available for investment and must ration the funds among four competing projects

Description

solution


Question

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 Net;Present;Value Life of;the;Project;(years) Internal;Rate;of Return;(percent);A $160,000 $44,323 7 18%;B $135,000 $42,000 12 16%;C $100,000 $35,035 7 20%;D $175,000 $38,136 3 22%;The net present values above have been computed using a 10% discount rate. The company wants your assistance in determining which project to accept first, second, and so forth.;Requirement 1;Compute the project profitability index for each project. (Round your answers to 2 decimal places.);Project Profitability;index;A;B;C;D;Requirement 2;In order of preference, rank the four projects in terms of Net present value, Project profitability index and Internal rate of return.;Net Present;Value Project;Profitability Index Internal Rate of;Return;First preference;Second preference;Third preference;Fourth preference

 

Paper#24981 | Written in 18-Jul-2015

Price : $32
SiteLock