eBook Show Me How PrintItem Average Rate of Return Method, Net Present Value Method, and Analysis for a service company The capital investment committee of Arches Landscaping Company is considering two capital investments. The estimated operating income and net cash flows from each investment are as follows: Front-End Loader Greenhouse Operating Year Income Net Cash Flow Operating Net Cash Income Flow 1 $56,700 $185,000 $119,000 $296,000 2 56,700 185,000 91,000 250,000 3 56,700 185,000 45,000 176,000 56,70 185,000 20,000 120,000 5 56,700 Total $283,500 185,000 $925,000 8,500 $283,500 83,000 $925,000 Each project requires an investment of $540,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 10% for purposes of the net present value analysis. Present Value of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0,909 0.893 0.870 0.833 2 0.890 0.826 0.797 0.756 0.694 3 0.840 0.751 0.712 0.658 0.579 4 0.792 0.683 0.636 0.572 0.482 0.747 0.621 0.567 0.497 0.402 6 0.705 0.564 0.507 0.432 0.335 Check My Work Previous Next > All work saved. Email Instructor Save and Exit Submit Assignment for Grading