26. Marys Kountry Kitchen on Route 4 is considering purchasing an commercial coffee machine to make coffee during its open hours. There are two manufacturers under consideration, below are the cost savings (cash flow) from each equipment, required rate of return is 8.5%:

Year Bunn machine Grindmaster-Cecilware

0 -$2,700 -$4,100

1 1,500 900

2 1,300 2,600

3 1,100 3,200

a) Calculate the profitability index for each of the two coffee machines.

b) Based on the PI, which machine should the restaurant purchase? 10pts