What is the profitability index

Assignment Help Managerial Accounting
Reference no: EM131162723

1. A company is considering a proposal that requires an initial investment of $91,100, has predicted net cash inflows of $30,000 per year for four years and no salvage value.  At a discount rate of 10 percent the projects net present value is...

2. Which of the following most accurately describes the term annuity?

a single cash flow that occurs at some future point in time

a series of equal, consecutive cash flows over time

an installment loan with lump sum payments

an investment that grows over time 

3. Given the following information and assuming a 10% discount rate, calculate the Net Present Value of the proposal.

Initial Investment                      ( $50,000)

Operating net cash flows:

        Year 1                                 $23,000

        Year 2                                 $25,000

        Year 3                                 $21,000

Disinvestment (year 3)                    $500

4. Which of the following capital budgeting tools is most effective in comparing two acceptable projects?

Payback Period

Net Present Value (NPV)

Future Value

Profitability Index (PI)

5. If the present value of net cash inflows of a project is $1,775,424 and the investment in the project is $1,467,293. What is the profitability index?

Reference no: EM131162723

Questions Cloud

Explanations for the division of household labor : 1. Explain the three explanations for the division of household labor. 2. Explain the challenges that families face in balancing work and family demands. 3. Explain the issues associated with leaving or staying in an abusive relationship.
Construct an activity on node network for the project : Construct an activity on node network for the project. -  Identify the paths and path project durations.- Determine the critical path and the expected project completion time.
How is the gender of sexuality : How is the gender of sexuality connected to the gender of the body?
How many shots should he aim at each target : In a youth contest, Joe will shoot a total of ten shots at four different targets. If Joe wants to maximize his expected number of points, how many shots should he aim at each target?
What is the profitability index : If the present value of net cash inflows of a project is $1,775,424 and the investment in the project is $1,467,293. What is the profitability index
Queer theory-postmodernism and ecofeminism : Considering queer theory, postmodernism, and ecofeminism, which form of feminism do they most closely reflect? Radical feminism or liberal feminism?
Form of feminism : Considering queer theory, postmodernism, and ecofeminism, which form of feminism do they most closely reflect? Radical feminism or liberal feminism?
Distribution of wealth and income in america : A. How do multinational corporations contribute to the maintenance of international stratification? B. What are the similarities and differences between the distribution of wealth and income in America? C. Discuss the three demographic variables and ..
Is it possible to die in the united states : Is it possible to die in the United States from not meeting your basic needs such as food or shelter?

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd