Question $1$

$(25$ Marks$)$

Study the information given below and answer the following questions:

The equipment costs R$1000000$ for each project and no scrap value is expected. The required rate of return is $12\%.$

NOTE: Where present value tables are required, use tables with $4$ decimal places.

REQUIRED

$1\mathrm{.}1$ Calculate the Payback Period of Nik and Nak Equipment. $($Answer must be expressed in years, months and days.$)$

$(8$ marks$)$

$1\mathrm{.}2$ Calculate the Accounting Rate of return $($on average investment$)$ of Nak Equipment $($answer expressed to two decimal places$).$

$(6$ marks$)$

$1\mathrm{.}3$ Calculate the Net Present Value of Nik Equipment. $($Round off amounts to the nearest Rand.$)$

$(5$ marks$)$

$1\mathrm{.}4$ Calculate the Internal Rate of Return of Nak Equipment $($answer expressed to two decimal places$).$

$(6$ marks$)$