Considering the unequal investments, which of the following techniques would be most approprlate for choosing between Investment A and Investment B?

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 14MC: This calculation determines profitability or growth potential of an investment, expressed as a...
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Garrison Company has two Investment opportunitles. A cash flow schedule for the Investments Is provided below:
Year
Investment A
Investment B
$(4,900)
1,960
1,960
1,960
$(5,850)
2,940
2
1,960
1,960
4
1,960
980
Considering the unequal Investments, which of the following techniques would be most approprlate for choosIng between Investment A and Investment B?
Multiple Choice
Payback method
Present value index
Net present value method
None of these answers is correct
Transcribed Image Text:Garrison Company has two Investment opportunitles. A cash flow schedule for the Investments Is provided below: Year Investment A Investment B $(4,900) 1,960 1,960 1,960 $(5,850) 2,940 2 1,960 1,960 4 1,960 980 Considering the unequal Investments, which of the following techniques would be most approprlate for choosIng between Investment A and Investment B? Multiple Choice Payback method Present value index Net present value method None of these answers is correct
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