A project capitalized for P 3,240,000 invested in depreciable asset will earn a uniform annual revenue of P 1,750,000 for 10 years. The costs for operation and maintenance total P 550,000 a year, and taxes and insurance will cost 4% of the first cost each year. The company expects its capital to earn 12% before income taxes. Using PW method with complete solution: 1. PW_IN is:

a) P 10,876,679.33 b) P 9,887,890.30 c) P 5,932,734.18 d) P 7,415,917.72 2. PW_OUT is:

a) P 5,309,918.68 b) P 7,787,880.73 c) P 7,079,891.57 d) P 4,247,934.94 3. PW_NET is:

a) P 2,807,998.73 b) P 3,088,798.60 c) P 1,684,799.24 d) P 2,105,999.05

Using Payback Period method with complete solution:

4. What is the payback period?

a) 2.27 years b) 1.01 years c) 3.03 years d) 1.52 years