PROBLEMIV Dyno-max is considering buying a new water treatment system for its plant in Austin Texas. The company screens its potential capital investments using the payback and accounting rate of return methods. If a potential investment has a payback of less than four years and a minimum 12% accounting rate of return, it will consider further follow: Cost of water treatment system Estimated residual value $48,000 Estimated annual net cash flow (each year for 5 years) from anticipated environment cleanup savings Estimated useful life 13,000 5 years Requirements Compute the water treatment system's payback Compute the water treatment system's ARR I. 2