HW Score: 73.81%, 22.08 of 30 ponts O Points of Save My Bean Inc. operates a chain of doughnut shops. The company is considering two possible expansion plans. Plan A would open aight smaler shops at a cost of $8.640.000 Expected annual retas ies are 11.750.000 with valun at the end of ten years. Under Plan B. My Bean would open three larger shops at a cost of $8.240,000. This plan is expected to generate net cash intoars of $1,150.000 per year for ten years, the stated its of the propertes Exte residual value is $950.000. My Bean uses straight-line depreciation and requires an annual rum of Click the icon to view the present value annuity factor table) (Click the icon to view the future value annuity factor table) Read the requirements (Click the icon to view the present value factor table (Ok the icon to view the future value tactor tabs) Requirement 1. Compute the payback period, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting more? Begin by computing the payback period for both plans. (Round your answers to one deomal place) Plan A (in years) Reference Plan B (in years) Fred Wof Auty of 11 Periods IS PN 10% 125 14% Requirements Pariad Prod Parisd Period 0911 62 1.300 1.800 1942 1913 1 19 170 178 1600 MT 2941 2814 1819 2.775 2.725 2473 2577 2487 2432 1802 1816 17 3430 334 345 334 31 307 48SS 4713 4580 4.452 432 4212 160 170 1800 1430 124 312 HAMS LING MY 0800 1800 1.34 5.528 230 2104 233 234 23442718 2000 IMM 2391 Period S 1. Compute the payback period, the ARR, and the NPV of these two plans What 112 Period 1.725 5801 1417 8242 5376 417 4623435 are the strengths and weaknesses of these capital budgeting models? Period 6728 4472 4230 4000 57005120 2. Which expansion plan should My Bean choose? Why? Period 7652 7305 7030 4.733 6485 6215 5747 395 4344 Period 9 856 82 1.746 745 7108 6.80 4.347 47 538 3. Estimate Plan A's IRR How does the IRR compare with the company's required rate of return? CADE 4181 Period 10 941 885 8530 811 7.722 7.300 670 610 500 126 47 Print Done Period 1 10.368 9.787 4253 4700 6306 7.867 7039 64 583 54309 48 4763 400 Period 12 11.255 10.575 954 385 883 834 7.536 6214 419410 494 4531 Period 13 12 134 1348 10635 896 434 435 7504 703 A 12 530 500 460 Period 14 13.304 12 100 11.290 10 563 889 52958.244 2307 6828 8002148 Period 15 13.305 12 34 11 838 11 18 1380 9712 8.500 7.006 081 442 575 500 45 $313 480 4340 4379 4347 Po 20 1834 16.35 14.877 13.100 12 412 11.470 9418 854 74694620509 Pasod 21 22 23 19.529 17.413 16.622 14 264 2783 10675 77 780 64 47 147 Period 38 25808 22 390 18 000 17.292 15.372 13.765 11.250 417 8258 70038177 537 Period 40 32835 27 385 23 115 9790 17 199 15048 1132587798244 7105 4230 558 Video Get more help. Hele me solve this of 30 ponts Part of Save O Points: 0 of 5 My Blean Inc. operates a chain of doughnut shops. The company is considering two possible expansion plans Plan A would open sight smafer shops at a cost of $0.640,000. Expected annual net cash intows are $1,750,000 with zero residual value at the end of ten years. Under Plan B, My Bean would open three larger shops at a cost of $8.240.000. This plan is expected to generate net cash inflows of $1,150,000 per year for ten years, the estimated life of the properties. Estimated msidual value is $950.000. My Bean uses straight-ine depreciation and requires an annual return of 8% (Click the icon to view the present value annuity factor table) (Click the loon to view the future value annuity factor table) Read the requirements (Click the icon view the present value factor table) (Click the icon to view the future value factorat) Requirement 1. Compute the payback penod, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of the capital budging mods? Begin by computing the payback period for both plans. (Round your answers to one decimal place) Plan A (in years) Plan B (In years) R, and the NPV (Round your ar Requirements - X 1. Compute the payback period, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting models? 2. Which expansion plan should My Bean choose? Why? 3. Estimate Plan A's IRR. How does the IRR compare with the company's required rate of return? Print Done La eriod, the ARR, and or both plans. (Rou Present Value of Annuity of $1 3% 4% 5% 6% 14% 16% 8% 10% 12% 0.926 0.909 0.893 1.783 1.736 1.690 0.877 0.862 1.647 1.605 Periods 1% 2% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2577 2.487 2402 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3037 4.853 4.713 4.580 4.452 4.329 4.212 3.990 3.791 3.605 5.795 5.601 5.417 5242 5.076 4.917 4.623 4.355 4.111 3.889 3.685 3.438 3.328 6.728 6.472 6.230 6.002 5.786 5.582 5.206 4.868 4.564 4.288 4.039 1812 3.605 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 8.566 8.162 7.786 7435 7.108 6.802 6.247 5.759 5.328 4.946 4607 4303 4.031 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.650 5.216 4833 4.494 4.192 18% 20% 0.847 0833 1.566 1.528 2.322 2.246 2.174 2.106 2.914 2.798 2.800 2.589 3.433 3.274 3.127 2991 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 10.368 11.255 12.134 13.004 13.865 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4656 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6194 5660 5197 4.793 11.348 10.635 9.966 9.394 8.853 7.904 7.103 6.424 5642 5.342 4910 12.106 11.296 10.563 9.899 9.295 8.244 7.367 6628 6.002 5468 5008 12.849 11.938 11.118 10 380 9.712 8.559 7.606 6.811 6.142 5.575 5.092 4.327 4.439 4.533 4.811 4675 Period 14 Period 15 4870 Period 20 18.046 22.023 4.548 Period 25 16.351 14.877 13.500 12.462 11470 9.818 8.514 7.469 6.623 5.829 5.353 19.523 17.413 15.622 14.094 12.783 10.675 9.077 7.543 6873 6.097 5.467 Period 30 25.808 22.396 19.600 17.292 15.372 13.765 11.258 9427 8.055 7.003 6.177 5517 Perlod 40 32.835 27.355 23 115 19.793 17.159 15.045 11.925 9.779 8.244 7.105 6233 5548 4987 4.979 Done Print in would me depre factor t actor tab ARR, and ans. (Rou sion plans Plan A would onen eight smaller shops at a cost of $8.640.000 Expected annual net cash inflows are $1,750 or ten years, the estimated life of th -X Reference 20% Period 4 Period 5 0.519 0.478 0.437 0.402 Period 6 Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% Period 1 0.990 0.980 0.971 0.962 0.952 0943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.857 0.826 0.797 0.769 0.743 0.718 0.694 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.794 0.751 0.712 0675 0.641 0.609 0.579 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.683 0.636 0.592 0.562 0.516 0.482 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.942 0.888 0.837 0.790 0.746 0.705 0630 0.564 0.507 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.583 0.513 0452 0.400 0.354 0.314 0279 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.404 0,351 0.305 0.266 0233 Period 9 0.914 0.837 0.766 0.703 0.645 0.502 0.500 0.424 0.361 0.308 0263 0225 0.194 Period 10 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0227 0.191 0.162 0.804 0.722 0.650 0.585 0.527 0.429 0.788 0.701 0.625 0.557 0.497 0.397 0.773 0.681 0.601 0.530 0469 0.368 0.290 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.743 0.642 0.555 0.481 0417 0.315 0.239 0.456 0410 0.370 0.335 0.905 Period 11 Period 12 0.896 0.887 Period 13 0.879 0.350 0.287 0237 0.195 0.162 0.135 0.319 0257 0.208 0168 0.137 0.112 0229 0.182 0.145 0.116 0.093 0.205 0.160 0.125 0.099 0.078 Period 14 0.870 0.861 Period 15 0.183 0.140 0.108 0.084 0.065 Period 20 0.673 0.554 0.820 0.780 0.456 0.377 0.375 0.295 Period 25 0.610 0.478 0312 0.215 0.149 0.104 0.073 0.051 0.037 0.026 0.233 0.146 0.092 0.050 0.038 0.024 0.016 0.010 Period 30 0.742 0.174 0.099 0.057 0.033 0.020 0012 0.007 0.004 Period 40 0.672 0.453 0.307 0.208 0.142 0.097 0.046 0.022 0.011 0.005 0.003 0.001 0.001 0.552 0.412 0.308 0.231 Print Done any eriod, the A for both pla Future Value of Annuity of $1 6% 8% 1.000 1.000 14% 10% 1.000 16% 18% 20% 12% 1.000 1.000 1.000 1.000 1.000 2160 2.180 2.200 3.572 3.640 Period 3 Period 4 Period 5 5215 5.308 7.442 6.152 6.308 7.214 7.434 Periods 1% 2% 3% 4% 5% Period 1 1.000 1.000 1.000 1.000 1.000 Period 2 2.010 2020 2030 2040 2.050 2.060 2.080 2100 2.120 3.030 3.060 3.091 3122 2.140 3.153 3.184 3.246 3.310 4.060 3.374 3.440 3.506 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4.779 4.921 5.066 5.101 5.204 5.309 5416 5.526 5.637 5.867 6105 6.353 6610 6.877 7.154 6.468 6.633 6.802 6.975 7.336 7.716 8.115 8.536 8.977 9.442 9.900 7.662 7.808 8.142 8.394 8.923 9.487 10.089 10.730 11.414 12142 12.916 8.286 8.583 8.892 9.214 9.549 9.897 10.637 11.436 12.300 13.233 14240 15.327 16.499 9.369 9.755 10.159 10.583 11.027 11491 12.488 13.579 14.776 16.085 17.519 19.086 10462 10.950 11.464 12.006 12.578 13.181 14.487 15.937 17.549 19.337 21.321 23.521 11.567 12.169 12.808 13.486 14.207 14.972 16.645 18.531 20.655 23.045 25.733 28.755 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.384 24 133 27271 30.850 34.931 13.809 14.680 15.618 16.627 17.713 18.882 21,495 24.523 28.029 32.089 36.786 42.219 43.672 50.818 14.947 15.974 17.086 18.292 19.599 21.015 24.215 27.975 32.393 37.581 $1.000 60.965 16.097 17.293 18.599 20.024 21.579 23.276 27.152 31.772 37.280 43.842 115.380 146 628 22.019 24.297 26.870 29.778 33.066 36.786 45.762 57.275 72.062 91.025 28.243 030 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 249 214 342.603 471.981 34.785 40.568 47.575 56.085 66.439 79.058 113.283 164.494 241.333 356.787 530.312 790.948 1,181.882 48.856 60.402 75.401 95.026 120.800 154.762 259.057 442.593 767 091 1.342 025 2.360.757 4.163.213 7.343.858 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 20.799 25.969 32.150 39.581 48.497 59 196 72.005 Period 15 186688 Period 20 Period 25 Period 30 Period 40 Done Print e annuity fact period, the ARF d for both plans. Future Value of $1 2% 3% 4% 5% 1.050 10% 1.010 1.020 16% 18% 1.030 1.040 6% 1.060 1.103 1.124 14% 1.140 1.160 1.180 1.020 1.040 1.061 12% 1.120 1.254 1.405 1.574 1.689 1811 1.300 1346 1.392 1.030 1.061 1,093 1.482 1.561 1.643 1.041 1.082 1.051 1.104 8% 1.080 1.100 1.082 1.166 1.210 1.125 1.158 1.191 1.260 1331 1.170 1.216 1262 1.360 1.464 1.217 1.276 1.338 1469 1.611 1.772 1974 2195 2436 2.700 1.949 2211 2.502 2.828 3.185 1.851 2.144 2476 2.853 3.278 3.750 1.999 2358 2773 3252 3.803 4.435 2.159 2.594 3.106 3.707 4411 5.234 1.939 1.762 1.925 2.100 2.258 1.062 1.126 1.126 1.159 1.194 1.265 1,340 1419 1.587 1.230 1.316 1.407 1.504 1.714 1.267 1.369 1.477 1.594 1,305 1.423 1.551 1.689 1.344 1.480 1,629 1.791 1.072 1.149 1.083 1.172 1.094 1.195 1.105 1.219 2.966 3.583 4.300 5.160 182 5.117 6.176 1.116 1.243 1,384 1.539 1.127 1.268 1.426 1.601 1.138 1.294 1.149 1.319 1.161 1.346 1.486 1.220 1.282 1.641 1.710 1.898 2332 2853 3.479 4.226 7.430 1.796 2012 2518 3.138 3.896 4818 5.936 7,288 8.916 1.469 1.665 1.886 2.133 2.720 3.452 4.363 5.492 6.886 8.500 10.609 1.513 1.732 7.988 10.147 12.839 1.980 2.281 2.937 3.797 4887 6.201 1.558 1.801 5.474 2.079 2.397 3.172 4.177 7.138 9.266 11.974 15.407 2.653 3.207 4661 6.727 9646 13.743 19.461 27.393 38.338 3.386 4.292 6.848 10.835 17.000 28.462 40.874 62 569 95.306 4.322 5.743 10.063 17.449 29.960 50.950 85.850 143371 237 376 7.040 10.286 21.725 45.259 93.061 188 884 378.721 750 378 1.460 772 1.806 2.191 2.094 2.666 2.427 3243 1.348 1.811 1.489 2.208 3.262 4.801 Done Print Periods 1% Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 Period 20 Period 25 Period 30 Period 40 20% 1.200 1.440 1.728 2.074 2438 properties Es