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nformation on four investment proposals is given below: ...

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Accounting

nformation on four investment proposals is given below:

Investment Proposal
A B C D
Investment required $ (120,000 ) $ (50,000 ) $ (50,000 ) $ (360,000 )
Present value of cash inflows 169,200 67,300 79,000 476,000
Net present value $ 49,200 $ 17,300 $ 29,000 $ 116,000
Life of the project 5 years 7 years 6 years 6 years

Required:

1. Compute the project profitability index for each investment proposal. (Round your answers to 2 decimal places.)

2. Rank the proposals in terms of preference.

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