Ingram Enterprises is considering an investment project with the following details:

• Initial investment of R1,600,000 and an expected residual value of R130,000.

Year	Cashflows	Discount factor
Year 1	R180,000	0.909
Year 2	R200,000	0.826
Year 3	R210,000	0.751
Year 4	R160,000	0.683
Year 5	R170,000	0.621

Cost of capital is 7%. Depreciation is R110,000 per year. Tax rate is 26%.

Required:

1. Calculate each of the following:
   • 1.9.1 Accounting Rate of Return (5)

1.9.2 Payback period (5)