Machine A Machine B

Initial Investment 28500 27000

Year

1 10000 11000

2 10000 10000

3 10000 9000

4 10000 8000

Required:

A) Use the above information to demonstrate the investment appraisal the following methods)

1- Payback method

2- Accounting rate of return (ARR) using the Average profit and the Average investment Net present value (NPV):

B) Advise the company on which to choose for each method you use on a question above.

Note : the answer should be computerized and the solutions should be in details ( How the results Came )