AnalySIS The company's capital rationing policy requires of three years. In addition, a minimum average rate projects. If the preceding standards are met, the net a maximum cash payback period of return of 12% is required on all present value method and present value indexes are used to rank the remaining proposals Instructions 1. Compute the cash payback period for each of the four proposals Giving effect to straight-line depreciation on the investments a residual value, compute the average rate of return for ea Round to one decimal place. 3. Using the following format, summarize the results of your computat (D and (2). By placing the calculated amounts in the first two and by placing a check mark in the appropriate column to the rign proposals should be accepted for further analysis and which should lumns on the left ed. be reject 1.b. Pro 549 465 Cash Payback Period Average Rate of Returrn Accept for Further AnalysisReject posal 4. For the proposals accepted for further analysis in part (3), compute the net present value. Use a rate of 12% and the present value of $1 table appearing in this chapter Exhibit 2) Compute the present value index for decimal places each of the proposals in part (4). Round to two 6. Rank the proposals from most attractive to least attractive, based on the present values 7. Rank the proposals from most attractive to least attractive, based on the present value nalyses, comment on the relative attractiveness of the proposals ranked 5. of net cash flows computed in part (4). indexes computed in part (5). 8. Based on the a in parts (6) and (7) Payback Period Proposal A: year -month cash payback period Net Cash Flow Cumulative Net Cash Flows Year and Months Year 1 Year 2 Year 3 Year 4 Proposal B: year month cash payback period Net Cash Flow Cumulative Net Cash Flows Year and Months Year 1 Year 2 Year 3 Year 4 Proposal C: month cash payback period 890123456789 22222 223 333333333 111-11-22 FG A BC 39 40 41 42 43 Net Cash Flow Cunulative Net Cash Flows Year and Months Year 1 Year 2 Year 3 Year 4 45 46 Proposal D: -month cash payback period year 48 49 50 51 52 Net Cash Flow Cumulative Net Cash Flows Year and Months Year 1 Year 2 Year 3 Year 4 56 57 4 B E F G K L MN Average Rate of Return 62 Proposal A: 65 67 68 Proposal B: 70 72 73 74 75 76 Proposal C: 78 79 80 81 Proposal D 82 83 84 85 LIMN 86 87 3 Cash Payback Period Years Average Rate of Return Accept for Further Analysis? 92 93 96 4., 5 97 Net Present Value and Present Value Index Present Value of $1 at 12% Net Cash Flow Present Value of Net Cash Floww 100 101 102 103 Year 1 Year 2 Year 3 Year 4 Year 5 05 106 107 108 09 110 Amount to be invested Net present value Present value index 112 113 Pr. 26-6A Ready 0 Type here to search nt of 2% 12 2 la kk aR 12345 ar ar ar ar ar al eeeee ot m et 141 142 143 8 144 Key essay answer here] 145 146 147 148 149 151 152 153 Pr. 26-6A Ready 0 Type here to search