How do you calculate the npv and profitability index for


This information is pertaining to the cash flows of three mutually exclusive investment proposals:

Proposal A Proposal B Proposal C

Initial Investment 60,000 60,000 60,000 60,000

Cash flow from operations

Year 1 50,000 30,000 60,000

Year 2 6,000 30,000

Year 3 29,000 25,000

Disinvestment 0 0 0

Life (Years) 3 yrs 3yrs 1yr

How do you Calculate the NPV and Profitability Index for each of the three proposals?

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Managerial Accounting: How do you calculate the npv and profitability index for
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