Question 4 - Payback Period and Accounting Rate of Return (25 points) Jones & Co Trucking is considering buying a number of new trucks at a total cost of $500,000. It has calculated the following cash flows during the 7-year life of these assets Year 1 - Cash Revenue $300.000 Cash Expense $210,000 Depreciation Year 2 - Cash Revenue $500,000 Cash Expense $350.000 Depreciation Year 3 - Cash Revenue $450,000 Cash Expense $320,000 Depreciation Year 4 - Cash Revenue $390,000 Cash Expense $270,000 Depreciation Year 5 - Cash Revenue $320,000 Cash Expense $250,000 Depreciation Year 6. Cash Revenue $290,000 Cash Expense $230,000 Depreciation Year 7 - Cash Revenue $250,000 Cash Expense $220,000 Depreciation Year 8 Salvage value to be received on sale of fully depreciated trucks - $10,000 $70.000 $70,000 $70,000 $70.000 $70,000 $70,000 $70,000 1. (10 points) Prepare a schedule of cash flows and calculate the payback period for this investment 2. (10 points) Prepare a schedule of annual accounting income and calculate the accounting rate of return for the life of the assets. 3.5 points) for purposes of decision making Jones & Co Trucking requires their investments to meet both the criteria of a payback period fewer than 5 years and an accounting rate of return of 5%. Based on these criteria, would Jones & Co Trucking make this investment