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QUESTION FOUR [25] Assume a R120 000 investment and the following cash flows for two alternatives A and B. Assume a R100 000 investment and

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QUESTION FOUR [25] Assume a R120 000 investment and the following cash flows for two alternatives A and B. Assume a R100 000 investment and the following cash flows for two alternatives A and B. The following information is provided: a) The Company requires a rate of return of 14% on its investment. b) The salvage value for both investments is R50000 4.1 Which of the two alternatives would you select under the payback method? 4.2 Highlight two (2) advantages and two (2) the disadvantages of using the payback method 4.3 Calculate the Net Present Value for both alternatives. On the basis of these calculations which alternative should be accepted

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