Required information Problem 24-2A 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 $315,000 investment for new machinery with a five-year life and no salvage value. Project Z requires a $315,000 investment for new machinery with a four-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 $ 370,000 $296,000 Sales Expenses Direct materials Direct labor Overhead including depreciation Selling and administrative expenses Total expenses Pretax income Income taxes (28%) Net income 51,800 74,000 133,200 26,000 285,000 85,000 23,800 $ 61,200 37,000 44,400 133,200 26,000 240,600 55,400 15,512 $ 39,888 Problem 24-2A Part 1 Required: 1. Compute each project's annual expected net cash flows. Project Y Project z Problem 24-2A Part 2 2. Determine each project's payback period. Payback Period Choose Numerator: 1 Choose Denominator: Payback Period Payback period Project Y Project 2 = Problem 24-2A Part 3 3. Compute each project's accounting rate of return. Accounting Rate of Return Choose Denominator: Choose Numerator: Il Accounting Rate of Return Accounting rate of return II Project Y Project 2 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: n = Select Chart Amount PV Factor = Present Value Net present value Project z Chart values are based on: n = Select Chart Amount X PV Factor Present Value Net present value