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Garcia Co. can invest in one of two alternative projects. Project Y requires a $360,000 initial investment for new machinery with a four-year life and no salvage valuc. Project Z requires a $360,000 initial investment for new machinery with a three-year life and no salvage value. The two projects yield the following annual results. Cash flows occur evenly within each year. Project Y Project Z $400,000 $500,000 Annual Amounts Sales of new product Expenses Materlols, lobor, and overhead (except depreciation) Depreciation --Machinery Selling, general, and administrative expenses Income 190.000 90.000 50,000 $ 70.000 200,000 120,000 50,000 $130.000 Required 1. Compute cach project's annual net cash flows. 2. Compute each project's payback period. If the company bases investment decisions solely on payback period, which project will it choose? Page 987 3. Compute each project's accounting rate of return. If the company bases investment decisions solely on accounting rate of return, which project will it choose? 4. Compute each project's not present value using 8% as the discount rate. If the company bases investment decisions solely on net present value, which project will it choose