Bosanil Sdn. Bhd. is considering of investing in two mutually exclusive projects and the free cash flows associated with those projects are as follows:

project A project B

Initial outlay -RM2400,000 -RM 320,000

Inflaw year 1 160,000 152,000

inflaw year 2 400,000 96,000

Inflaw year 3 200,000 144,000

inflaw year 4 3,120,000 84,000

Whichever project you choose, if any, the required rate of return on these projects is 15 percent.

a)Calculate each project's payback period. (5 marks)

b)Calculate each project's NPV. (5 marks)

c)Calculate each project's discounted payback. (5 marks)

d)Calculate the profitability index. (5 marks)

e)Based on your answers which project will you recommend? (5 marks)