QUESTION 5 (20 Marks) Note: Where applicable, use the present value tables provided in APPENDICES 1 and 2 that appear after REQUIRED Use the information given below to calculate the following: 5.1 Payback Period of both projects (answers expressed in years and months). (4 marks) 5.2 Accounting Rate of Return of Project A (answer expressed to two decimal places). (3 marks) 5.3 Net Present Value (NPV) of both projects (amounts rounded off to the nearest Rand). (6 marks) 5.4 Profitability Index of Project B (answer expressed to two decimal places). (2 marks) 5.5 Internal Rate of Return of Project B (answer expressed to two decimal places). (5 marks) INFORMATION Gentry Ltd had to choose between these two projects, Project A or Project B, for which the following net cash inflows have been forecasted: Year 1 2 3 4 Project A R60 000 R160 000 R200 000 R360 000 Project B R172 000 R172 000 R172 000 R172 000 Project A requires an investment of R560 000 while project Project B requires an investment of R500 000. The average annual profit of projects Project A and Project B are expected to be R55 000 and R47 000 respectively. Both projects are expected to have no salvage value. The minimum required rate of return on these projects is 12%.