Ajax Corp is considering investing in a project with the following forecasted details:

• Initial amount invested is R500,000 and expected residual value is R40,000.

Year	Cashflows	Discount factor
Year 1	R100,000	0.91
Year 2	R120,000	0.83
Year 3	R160,000	0.75
Year 4	R80,000	0.68
Year 5	R90,000	0.62

Assuming that the cost of capital for the company is 10%. The cash flows are after tax and depreciation is charged at R40,000 per year. Tax rate is 30%.

Required:

1. Calculate each of the following:
   • 1.1.1 Accounting Rate of Return (5)
   • 1.1.2 Payback period (5)