Sorenson Motors (SM) is considering a project that has the following cash flows:

Year Cash Flow 0 Initial Outlay 1 $2,000 2 3,000 3 3,000 4 1,500 The project has a payback period of 2.5 years. The weighted average cost of capital is 12%. Which of the following statements is NOT correct? The project is generating more cash than is needed to service its debt, and this excess cash accrues solely to SM