142 senseman company has three potential projects from which to choose selected info 4310230
142) Senseman Company has three potential projects from which to choose. Selected information on each of the three projects follows:
Project A 
Project B 
Project C 

Investment required 
$ 42,500 
$ 56,000 
$ 53,700 
Net present value of project 
$ 45,700 
$ 75,400 
$ 70,200 
Using the profitability index, rank the projects from most profitable to least profitable.
A) A, B, C
B) C, B, A
C) B, A, C
D) B, C, A
143) Silver Creations is evaluating a project that would require an initial investment of $36,000. The present value of the net cash inflows associated with this project would be $43,200. The profitability index for this project would be closest to
A) 0.83.
B) 1.20.
C) 0.20.
D) 5.00.
144) (Present value tables are needed.) Cleveland Cove Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two–the B14 Model and the F54 Model. Financial data about the two choices follows.
B14 Model 
F54 Model 

Investment 
$ 320,000 
$ 240,000 
Useful life (years) 
8 
8 
Estimated annual net cash inflows for useful life 
$ 70,000 
$ 35,000 
Residual value 
$ 30,000 
$ 10,000 
Depreciation method 
Straightline 
Straightline 
Required rate of return 
14% 
10% 
What is the total present value of future cash inflows from the F54 Model?
A) $(48,605)
B) $186,725
C) $191,395
D) $167,035
145) (Present value tables are needed.) Cleveland Cove Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two: the B14 Model and the F54 Model. Financial data about the two choices follows.
B14 Model 
F54 Model 

Investment 
$ 320,000 
$ 240,000 
Useful life (years) 
8 
8 
Estimated annual net cash inflows for useful life 
$ 70,000 
$ 35,000 
Residual value 
$ 30,000 
$ 10,000 
Depreciation method 
Straightline 
Straightline 
Required rate of return 
14% 
10% 
What is the total present value of future cash inflows from the B14 Model?
A) $15,260
B) $335,260
C) $383,980
D) $191,395
146) (Present value tables are needed.) Cleveland Cove Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two: the B14 Model and the F54 Model. Financial data about the two choices follows.
B14 Model 
F54 Model 

Investment 
$ 320,000 
$ 240,000 
Useful life (years) 
8 
8 
Estimated annual net cash inflows for useful life 
$ 70,000 
$ 35,000 
Residual value 
$ 30,000 
$ 10,000 
Depreciation method 
Straightline 
Straightline 
Required rate of return 
14% 
10% 
What is the net present value of the F54 Model?
A) $15,260 positive
B) $48,605 negative
C) $191,395 positive
D) $156,395 positive
147) (Present value tables are needed.) Cleveland Cove Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two: the B14 Model and the F54 Model. Financial data about the two choices follows.
B14 Model 
F54 Model 

Investment 
$ 320,000 
$ 240,000 
Useful life (years) 
8 
8 
Estimated annual net cash inflows for useful life 
$ 70,000 
$ 35,000 
Residual value 
$ 30,000 
$ 10,000 
Depreciation method 
Straightline 
Straightline 
Required rate of return 
14% 
10% 
What is the net present value of the B14 Model?
A) $15,260 positive
B) $48,605 negative
C) $5,800 negative
D) $335,260 positive
148) (Present value tables are needed.) Cleveland Cove Enterprises is evaluating the purchase of an elaborate hydraulic lift system for all of its locations to use for the boats brought in for repair. The company has narrowed their choices down to two: the B14 Model and the F54 Model. Financial data about the two choices follows.
B14 Model 
F54 Model 

Investment 
$ 320,000 
$ 240,000 
Useful life (years) 
8 
8 
Estimated annual net cash inflows for useful life 
$ 70,000 
$ 35,000 
Residual value 
$ 30,000 
$ 10,000 
Depreciation method 
Straightline 
Straightline 
Required rate of return 
14% 
10% 
Using the net present value model, which alternative should the company select?
A) Neither investment should be selected.
B) The F54 Model should be selected.
C) Both investments should be selected.
D) The B14 Model should be selected.
149) (Present value tables are needed.) The Janus Vending Machine Company is looking to expand its business by adding a new line of vending machines. The management team is considering expanding into either soda machines or snack machines. Following is the relevant financial data relating to the decision:
Soda Machines 
Snack Machines 

Investment 
$75,000 
$50,000 
Useful life (years) 
5 
10 
Estimated annual net cash inflows for useful life 
$30,000 
$18,000 
Residual value 
$30,000 
$10,000 
Depreciation method 
straightline 
straightline 
Required rate of return 
8% 
12% 
What is the present value of all future cash inflows from the snack machines?
A) $101,700
B) $104,920
C) $75,094
D) $54,920
150) (Present value tables are needed.) The Janus Vending Machine Company is looking to expand its business by adding a new line of vending machines. The management team is considering expanding into either soda machines or snack machines. Following is the relevant financial data relating to the decision:
Soda Machines 
Snack Machines 

Investment 
$75,000 
$50,000 
Useful life (years) 
5 
10 
Estimated annual net cash inflows for useful life 
$30,000 
$18,000 
Residual value 
$30,000 
$10,000 
Depreciation method 
straightline 
straightline 
Required rate of return 
8% 
12% 
What is the total present value of future cash inflows from the soda machines?
A) $189,930
B) $104,920
C) $62,220
D) $140,220
151) (Present value tables are needed.) The Janus Vending Machine Company is looking to expand its business by adding a new line of vending machines. The management team is considering expanding into either soda machines or snack machines. Following is the relevant financial data relating to the decision:
Soda Machines 
Snack Machines 

Investment 
$75,000 
$50,000 
Useful life (years) 
5 
10 
Estimated annual net cash inflows for useful life 
$30,000 
$18,000 
Residual value 
$30,000 
$10,000 
Depreciation method 
straightline 
straightline 
Required rate of return 
8% 
12% 
What is the net present value for the snack machines?
A) $(65,220)
B) $104,920
C) $54,920
D