A company is considering investing $240,000 in either Project S or Project T with the following cash flows:

Year	Project S	Project T
1	$80,000	$18,000
2	$80,000	$33,000
3	$80,000	$58,000
4	$80,000	$125,000
5	$80,000	$52,000

The firm's discount rate is 12%.

Required:

a) Determine the following for each project:

• Simple payback period
• Discounted payback period
• Net present value
• Internal rate of return
• Profitability index

b) Recommend which project should be undertaken and justify your recommendation.