Question 1 Beacon Chemicals plc is considering buying some equipment to produce a chemical named X14. The new equipment's capital cost is estimated at RM100,000 and if its purchase is approved now, the equipment can be bought and commence production by the end of this year. RM50. 000 has already been spent on research and development work. Estimates of revenues and costs arising from the operation of the equipment as follows: Year 1 Selling price (RM per unit) | 100 Sales volume (units) 800 Variable costs (RM per unit) 50 Fixed costs (RM000) 30 Year 2 120 1000 50 30 Year 3 120 1200 40 30 Year 4 100 1000 30 30 Year 5 80 800 40 30 If the equipment is bought, sales of some existing products will be lost and this will result in a loss of contribution of RM15 000 a year over its life. The accountant has informed you that the fixed costs include depreciation of RM20.000 a year on the new equipment. They also include an allocation of RM10,000 for fixed overheads. A separate study has indicated that if the new equipment were bought additional overheads excluding depreciation arising from producing the chemical would be RM8,000 a year. Production would require additional working capital of RM30.000. Ignore taxations. Beacon Chemicals plc has an average cost of capital of 8% in money terms. Required: Calculate the payback period, net present value, and accounting rate of return of the planned investment project. (20 marks)