Primmel Corporation is considering an investment that will cost $120,000 and last for five years. The investment will be amortized on a straight-line basis over that period. Earnings generated by the investment before amortization and taxes over this period are as follows:

Year 1	35,000
Year 2	37,000
Year 3	41,000
Year 4	45,000
Year 5	50,000

Primmel Corporation has a tax rate of 25 percent.

Part 1 - What is the AAR of this project?

Part 2 - Should this project be accepted? What criteria would you use to accept or decline the project?