Beta Company is evaluating two new ventures with the following net cash flows. The company’s required rate of return on investments is 9%. (PV of $1, PV of Annuity of $1, PVA of $1, and FVA of $1)

Year	Project M	Project N
0	$(120,000)	$(110,000)
1	$25,000	$20,000
2	$35,000	$30,000
3	$45,000	$40,000
4	$55,000	$50,000
5	$65,000	$60,000

a. Determine the payback period for each project. Based on the payback period, which project is preferred?

b. Determine the net present value for each project. Based on the net present value, which project is preferred?