Section C - Long Answer Question Rehab Private Limited company currently manufactures customised shapes of chocolates. Due to the growing demand for customised shaped chocolates, the company is contemplating to expand production capacity. Therefore, the company is planning to invest in a high-tech machinery which will enable the company to meet the expected demand of production. Due to the financial constraints in the current year the organization budget to purchase a new machinery is constrained to RO 150,000. Mr. Waleed, who is the production manager of the company has been able identify two investment opportunities. Below is the relevant financial information for two investment projects: Machine A Machine B Initial Investment cost RO 150,000 RO 150,000 Operating Profit Before depreciation Year! RO 32,500 RO 34,000 Year 2 | RO 37,500 RO 36,000 Year 3 RO 45,000 RO 47,000 Year 4 RO 43,000 RO 45,000 Estimated scrap value RO 30,000 RO 40,000 4 3 0.816 0.873 The company's cost of capital is 7%. Year 1 2 PV Factor @ 7% 0.935 0.763 You are appointed as the finance consultant in Rehab Private Limited company. Based on the given information above, you are required to calculate the following. a. Payback period (PBP) for Machine A and Machine B (5 Marks) b. Average Rate of Return (ARR) for Machine A and Machine B (8 Marks) c. Net present Values (NPV) for Machine A and Machine B (5 Marks) d. Internal rate of Return (IRR) for Machine A and Machine B (6 Marks) (The negative NPV of 5828.5 for Machine A at 10% and 13,711.3 for Machine B at 15%) e. Profitability Index for Machine A and Machine B (4 Marks) f. Based on the calculations, advise the management which project they should go ahead to maximise the financial sustainability of the organization (2 Marks) (TOTAL 30 MARKS)