Required information Problem 11-2A Analysis and computation of payback period, accounting rate of return, and net present value LO P1, P2, P3 [The following information applies to the questions displayed below.] Most Company has an opportunity to invest in one of two new projects. Project Y requires a $350,000 investment for new machinery with a four-year life and no salvage value. Project Z requires a $350,000 investment for new machinery with a three-year life and no salvage value. The two projects yield the following predicted annual results. The company uses straight-line depreciation, and cash flows occur evenly throughout each year. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project Y Project Z $350,000 $280,000 Sales Expenses Direct materials Direct labor Overhead including depreciation Selling and administrative expenses Total expenses Pretax income Income taxes (30%) 49,000 70,000 126,000 25,000 270,000 80,000 24,000 $ 56,000 35,000 42,000 126,000 25,000 228,000 52,000 15,600 $ 36,400 Net income Problem 11-2A Part 4 4. Determine each project's net present value using 8% as the discount rate. Assume that cash flows occur at each year-end. (Round your intermediate calculations.) Project Y Chart values are based on: Select Chart Present Value of an Annuity of 1 Amount x 143,500 x PV Factor = 0.7575 = Present Value $ 108,701 $ $ 108,701 Present value of cash inflows Present value of cash outflows Net present value Project Z Chart values are based on: n = 3 8% Amount * 143,500X PV Factor = Present Value Select Chart Present Value of an Annuity of 1 $ Present value of cash inflows Present value of cash outflows Net present value