The Following Table Gives the Available Projects (In $Millions)for a Firm

question 58

Multiple Choice

The following table gives the available projects (in $millions) for a firm.

The firm has only $20 million to invest. What is the maximum NPV that the company can obtain?

• A)3.5
• B)4.0
• C)4.5
• D)5.0

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Definitions:

Income Summary

The Income Summary is an account in the ledger that aggregates all revenues and expenses for a period, transferring the net result to owner's equity.

Permanent Accounts

Accounts that carry their ending balances over to the next accounting period. Examples include assets, liabilities, and equity accounts.

Post-closing Trial Balance

A listing of all active general ledger accounts with their balances after closing entries are made, serving as a check to ensure debits equal credits before beginning a new accounting period.

Income Statement

A report that outlines a company's financial results for a certain period, including income and expenditures, to reveal a net gain or deficit.