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Most Company has an opportunity to invest in one of two new projects Project Y requires a $350.000 Investment for new machinery with a six-year life and no salvage value. Project Z requires a $350,000 Investment for new machinery with a five-year life and no salvage value. The two projects yield the following predicted annual results. The company uses straight line depreciation and cash nows occur evenly throughout each year (FV of $1. PV of $1. FVA of S1 and PVA of 50) (Use appropriate factors) from the tables provided.) Project Y $360,000 Project z $288,000 Sales Expenses Direct materials Direct labor Overhead including depreciation Selling and administrative expenses 50.400 72,000 129,600 26.000 36,000 43,200 129,600 26,000 Total expenses 278,000 234,800 Pretax income Income taxes (389) 82,000 31,160 53,200 20,216 Net Income $ 50,840 $ 32,984 Compute each project's annual expected net cash flows. Project Y Project Z Net income Depreciation expense Expected net cash flows Determine each project's payback period. Payback Period Choose Numerator! Choose Denominator: - Payback Period Payback period Project Y Project Z Compute each project's accounting rate of return Accounting Rate of Return Choose Numerator: Choose Denominator: Accounting Rate of Return Accounting rate of retum Project Y Project Z Determine each project's net present value using 9% as the discount rate Assume that cash flows occur at each year-end. (Round your intermediate calculations.) Project Y Chart values are based on: Select Chart Amount PV Factor - Present Value Net present value Project 2 Chart values are based on: Select Chart Amount * PV Factor - Present Value Net present value

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