Use the Following Information for Questions 106-108 $\text { Present Value of an Annuity of } 1$

Multiple Choice

Use the following information for questions 106-108.
Cleaners, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful life with no salvage value. Cleaners requires a 10% rate of return. $\text { Present Value of an Annuity of } 1$
$\begin{array}{ll}\text { Periods } &8\%& 9 \% & 10 \% & 11 \%& 12 \%&15\%\\5&4.623&4.486&4.355&4.231&4.111&3.784\end{array}$

-What is the approximate profitability index associated with this equipment?

A) 1.23
B) 1.03
C) 1.06
D) .73