Compute the payback period for each of these two separate investments: a. A new operating system for an existing machine is expected to cost $250,000 and have a useful life of four years. The system yields an incremental after-tax income of $72,115 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $10,000. b. A machine costs $190,000, has a $13,000 salvage value, is expected to last eleven years, and will generate an after-tax income of $39,000 per year after straight-line depreciation. Payback Period Choose Choose Numerator: Denominator: II Payback Period = Payback period = 0 a. b. = 0 Exercise 24-11 Net present value, profitability index LO P3 Following is information on two alternative investments being considered by Tiger Co. The company requires a 5% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Initial investment Expected net cash flows in year: Project x1 $(82,000) Project x2 $(124,000) 2 26,000 36,500 61,500 61,500 51,500 41,500 a. Compute each project's net present value. b. Compute each project's profitability index. If the company can choose only one project, which should it choose? Complete this question by entering your answers in the tabs below. Required A Required B Compute each project's net present value. (Round your final answers to the nearest dollar.) Net Cash Flows Present Value of 1 at 5% Present Value of Net Cash Flows Project X1 Year 1 Year 2