Most Company has an opportunity to invest in one of two new projects. Project Y requires a $340,000 investment for new machinery with a four-year life and no salvage value. Project Z requires a $340,000 investment for new machinery with a three-year life and no salvage value. The two projects yield the following predicted annual results. The company uses straight-line depreciation, and cash flows occur evenly throughout each year. (FV of $1, PV of $1, FVA of $1 and PVA of $1) (Use appropriate factor(s) from the tables provided.)

	Project Y					Project Z
Sales		$	370,000				$	330,000
Expenses
Direct materials			51,800					41,250
Direct labor			74,000					49,500
Overhead including depreciation			133,200					148,500
Selling and administrative expenses			26,000					29,000
Total expenses			285,000					268,250
Pretax income			85,000					61,750
Income taxes (26%)			22,100					16,055
Net income		$	62,900				$	45,695
4. Determine each projects net present value using 8% as the discount rate. Assume that cash flows occur at each year-end. (Round your intermediate calculations.)

Required:

1. Compute each projects annual expected net cash flows

2. Determine each projects payback period.

3. Compute each projects accounting rate of return.

4. Determine each projects net present value using 8% as the discount rate. Assume that cash flows occur at each year-end. (Round your intermediate calculations.)