Oxford Company has limited funds available for investment and must ration the funds among four competing projects. Selectedinformation on the four projects follows:Life ofNettheInternalProject(years) of ReturnInvestmentPresentRateProjectRequired$970,000$730,000$670,000$830,000Value$176,514$175,933$185,782$129,082A6.16%В1115%C19%17%The net present values above have been computed using a 10% discount rate. The company wants your assistance in determiningwhich project to accept first, second, and so forth. Compute the project profitability index for each project. (Round your answers to 2 decimal places.)ProjectProject ProfitabilityIndexAВCDIn order of preference, rank the four projects in terms of net present value, project profitability index and internal rate ofreturn.Net PresentValueProjectProfitabilityIndexInternal Rateof ReturnFirst preferenceSecond preferenceThird preferenceFourth preference

profitability index higher the better. NPV higher the better. IRR higher the better.

Answered: Oxford Company has limited funds…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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