Required information Problem 11-2A Analyzing and computing 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 $330,000 investment for new machinery with a six-year life and no salvage value. Project Z requires a $330,000 investment for new machinery with a five-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 2 $ 400,000 $320,000 Sales Expenses Direct materials Direct labor Overhead including depreciation Selling and administrative expenses Total expenses Pretax income Income taxes (408) diet income 56,000 80,000 144,000 29,000 309,000 91,000 36,400 $ 54,600 40,000 48,000 144,000 29,000 261,000 59,000 23,600 $ 35,400 Problem 11-2A Part 3 3. Compute each project's accounting rate of return. Accounting Rate of Return Choose Denominator Choose Numerator: Accounting Rate of Return Accounting rate of retum 1 Project Y Project Z