Garcla Company can Invest in one of two alternative projects. Project Y requires a $360,000 Initial Investment for new machinery with a four-year life and no salvage value. Project Z requires a $360,000 Initial Investment for new machinery with a three-year life and no salvage value. The two projects yield the following annual results. Cash flows occur evenly within each year. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Annual Amounts sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute each project's annual net cash flows. Required: 1. Compute each project's annual net cash flows. 2. Compute each project's payback period. If the company bases Investment decisions solely on payback period, which project will it choose? Annual Amounts 3. Compute each project's accounting rate of return. If the company bases Investment decisions solely on accounting rate of return, which project will It choose? 4. Compute each project's net present value using 8% as the discount rate. If the company bases Investment decisions solely on net present value, which project will it choose? Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income Net cash flow $ $ Income Project Y $ 400,000 400,000 $ Required 1 190,000 90,000 50,000 $ 70,000 Project Y Cash Flow 190,000 90,000 50,000 70,000 400,000 Project z $ 500,000 Required 2 200,000 120,000 50,000 $ 130,000 > Project Z Saved Income Home 200,000 120,000 50,000 Cash Flow

Garcla Company can invest in one of two alternative projects. Project Y requires a $360,000 initial investment for new machinery with a four-year life and no salvage value. Project Z requires a $360,000 initial investment for new machinery with a three-year iffe and no salvage value. The two projects yleld the following annual results. Cash flows occur evenly within each year. (PV of \$1, EV of $1, PVA of \$1, and FVA of \$1) (Use appropriote factor(s) from the tables provided.) Requlred: 1. Compute each project's annual net cash flows 2. Compute each project's payback period. If the company bases investment decisions solely on payback period. which project witl it choose? 3. Compute each project's accounting rate of return. If the company bases investment decisions solely on accounting rate of return. which project wili it choose? 4. Compute each project's net present value using 8% as the discount rate. If the company bases investment decisions solely on net present value, which project will it choose? Complete this question by entering your answers in the tabs below. Compute each project's annual net cash flows