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ABC Company is considering the purchase of a new forklift forits flourishing roofing business. The key parameters of the threeforklifts under scrutiny (Alpha, Beta and Gamma) are providedbelow.

Parameters	Alpha	Beta	Gamma
Initial Cost($)	400,000	500,000	550,000
Revenues ($)	230,000 at EOY1 Decreasing by 1% annually thereafter	300,000 at EOY1 increasing by 1000 annually thereafter	330,000 at EOY1 decreasing by 1500 annually thereafter
Operating Costs ($)	105,000 at EOY1 increasing by 2% annually thereafter	214,000 annually	223,000 at EOY1 increasing by 1000 annually thereafter
End-of life salvage value	-10,000	10,000	25,000
Useful life (years)	5	10	10
Industry Standard = 4 years	MARR = 10%	EOY = End of year

8. Based on the simple payback method, Beta’s project balanceafter 2 years (rounded to the nearest $100) is a) $-327,000; b)$-307,000; c) $-249,900; d) $54,900.

9. Based on the discounted payback method, Gamma’s recoveryperiod (to the nearest half or full year) is a) 7.0 years; b) 7.5;c) 8.5; d) 9.5.

10. Based on the discounted payback method, Alpha’s projectbalance after 2 years (rounded to the nearest $100) is a)$-225,900; b) $-204,300; c) $65,000; d) $100,800.

11. Based on the discounted payback method, Gamma’s projectbalance after 3 years (rounded to the nearest $100) is a)$-445,200; b) $-385,600; c) $-195,700; d) $115,900.

12. Beta’s benefit/cost (B/C) ratio (second decimal; norounding) is a) 0.98; b) 1.03; c) 1.10; d) 1.12.

13. Gamma’s benefit/cost (B/C) ratio (second decimal; norounding) is a) 0.98; b) 1.03; c) 1.05; d) 1.12.

14. The incremental B/C ratio (second decimal; no rounding)between Alpha and Beta is a) 0.92; b) 0.98; c) 1.02; d) 1.05.

15. The incremental B/C ratio (second decimal; no rounding)between Beta and Gamma is a) 0.95; b) 1.01; c) 1.03; d) 1.11