P12-64A (similar to) Question Help Has Beans Inc operates a chain of doughnutshops. The company is considering two possible expansion plans. Plan A would open eight smaller shops at a cost of $8,940,000. Expected annual net cash inflows are $1,800,000 with zero residual value at the end of ten years Under Pan B. Has Beans would open three larger shops at a cost of $8,740,000. This plan is expected to generate net cash inflows of $1,300,000 per year for ten years, the estimated life of the properties. Estimated residual value is $950,000 Has Beans uses straight line depreciation and requires an annual return of 10% Click the icon to view the present value annuty factor table) (Click the icon to view the present value factor table) (Click the icon to view the future value annuity factor table) (Click the icon to view the future value tactor table> Read the requirements 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 models? Begin by computing the payback penod for both plans. (Round your answers to one decimal place) Plan A (in years) 50 Plan B in years) 67 Now compute the ARR (accounting rate of retum) for both plans (Round the percentages to the nearest tenth percent) Plan A Plan B 60 Next compute the NPV (net present value) under each plan. Begin with Plan A then compute Pan B. (Round your answers to the nearest whole dollar and use parentheses or a minus sign to represent a negative NPV) 10.1 % Net present value of Pan A Enter any number in the edit fields and then click Check Answer Check Answer 5 ats Tema Clear All Type here to search o C BP 0 tion Rolerance of these mont udge COM in y in ye Present Value of Annuity of S1 Periode 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 0990 0.980 0,971 0.962 0.962 0943 0.928 0.909 0 893 0.877 0862 087 0833 Period 2 1970 1912 1913 1.896 1.859 1833 1783 1736 1.690 1647 1.605 1566 1.528 Period 3 2911 281 2829 2775 2723 2673 2577 2487 2402 2322 2246 2 1742 106 Period 4 3.902 3.808 3.717 3630 3546 3465 3312 3.170 3.037 2914 2798 2600 2589 Period 5 4853 4713 4580 4.45243294212 3.903 3.791 3 606 3433 3274 3.127 2991 Period 6 5796 5601 5.417 522 5.076 4917 4623 4 355 4 111 3.889 3685 3.498 3326 Period 7 6.728 6472 6230 6.002 578 55825 206 48684564 4288 4039 3812 3605 Period 8 76527325 7020 6.733 6.463 6210 5747 5335 4968 4639 4344 4078 3837 Period 9 8586 8. 16277867435 7.108 6.802 6 247 5759 5328 4916 4607 4 303 4031 Period 10 9.471 8.963 8530 8.1117.722 7.360 6.710 6.145 5650 5 216 4833 4.494 4.192 Period 11 10388 9.787 9253 8.780 8305 7887 7.1396496 5938 5453 5.029 4658 4327 Period 12 11 255 10.575 99549.385 8.863 8.394 7536 68146.1945.680 5.197 4793 4.439 Poriod 13 12 134 11.348 10636 9.96 9,394 88537904 7.10364245842 5.342 4910 4533 Period 14 13.004 12 106 11 296 10563 9.999 9295 824473676.6286002 5468 5008 4611 Period 15 13 885 12849 11938 11.118 10380 9.712 8559 7.606 6811 6.142 5575 50924675 Period 20 18.048 15.351 14877 13,590 12 462 11.470) 9.818 8.514 7.4696 623 5 929 5.353 4870 Period 25 22 023 19.52317413 15.622 14 00412783 10.675 9.077 7.843 6.873 6.097 5457 4.948 Period 30 25808 22 396 19.800) 17 292 15372 13.785 112589.427 8.0567.003 8,177 5517 4979 Period 40 32835 27 356 23.11519793 17.1591504811925 9.779 8.244 7.105 6 233 55484997 mu e nearest mute ollar Print Done any number in the edit fields and then click Check Answer Clear All Check Answer ing o Type here to search sine operates a can of do Would open eight host a cost of $8,040.000. Expected annual net cashindows are $1.000.000 with zero residual value at the end of ten years Reference Future Value of Annuity of S1 Periode 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 1.000 1.000 1000 1000 1.000 1.000 1000 1.000 1.000 1.000 1000 1.000 1000 Period 2 2010 2020 2030 2040 2050 2060 2080 2.100 2.120 2140 2160 2.180 2200 Period 3 1.030 3000 3001 3.122 3.153 3.184 3246 3310 3374 3440 3.506 3.572 3.640 Period 4 4080 4122 4.184 42464310 4375 4.506 4541 4.779 4.921 5.068 5215 5.368 Porod 6 5.101 5204 5300 5416 5525 5637 5.867 6.105 6353 6.610 6.877 7.154 7442 Period 6 6.152 6.308 6.4686.630 6802 6.975 7336 7.716 8. 115 8536 8.977 9.442 9.930 Period 7 7.214 7.4347.662 7.896 8 1428.394 8.923 9.487 10.000 10730 11414 12 142 12916 Period & 8.286 8583889292149.549 9.897 10.637 11.435 12 300 13233 14 240 15,327 16.499 Period 9 9.389 9.755 10.159 1058311027 11.491 12 488 13.579 14.776 16.085 17519 19.086 20.799 Period 10 10.462 10.950 11464 12.006 12578 13 181 14.487 15.93717519 19 337 21321 23.521 25959 Period 11 11.567 12.16912 13.486 14 207 14.972 16.645 18 531 20.655 23.045 25.733 28755 32.150 Period 12 12 683 13.412 14.192 15026 15917 16.870 18.977 21.384 24 133 27271 30 950 34 931 Period 13 13 809 14.680 15618 16.827 1771318 882 21.495 24523 28.029 32089 39581 38 786 42219 48.497 Period 14 14.947 15974 17.086 18 29219.599 21.015 24 215 27.97532393 37581 43 672 50.818 59.198 Period 15 16 097 17 29318 590 20.024 21579 23 278 27.15231772 37 29043842 51.680 60.965 72.035 Period 20 22019 21.297 26870 29.778 33.086 35788 45 762 57 275 72.052 91.025 115380 146.628 Period 25 28 243 320303545041 848 47727 54.866 7310688 347 133 334 181871 249.214 342803 471.981 188.688 Period 30 31.785 40568 47575 56.00506439 79 068 113.283 164 494 211,333 356.787 530.312790 9181,181.882 Period 40 48 886 60 402 75401 86.625 120.800 154.762259 057 442 593 767091 1342025 2380 7574 163 2137343 858 Print Done number in the edit fields and then click Check Answer Clear All Check Answer Type here to search o BE hi