Tasty Doughnuts has computed the net present value for capital expenditure at two locations. Relevant...
50.1K
Verified Solution
Link Copied!
Question
Accounting
Tasty Doughnuts has computed the net present value for capital expenditure at two locations. Relevant data related to the computation are as follows:
Line Item DescriptionDes MoinesCedar RapidsTotal present value of net cash flow$230,300 $288,400 Amount to be invested(235,000)(280,000)Net present value$(4,700)$8,400
a. Determine the present value index for each proposal. Round your answers for the present value index to two decimal places.
Line Item DescriptionDes MoinesCedar RapidsTotal present value of net cash flow$fill in the blank 1$fill in the blank 2Amount to be investedfill in the blank 3fill in the blank 4Present value indexfill in the blank 5fill in the blank 6b. Which location does your analysis support? (If both present value indexes are the same, either location will grade as correct.)
Des MoinesCedar Rapids
, because the net present value index is
less thangreater than
1.
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Best
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.