The company is considering two possible expansion plans. Plan A would open eight smaller shops at cost of $8,425,000. Expected annual net cash inflows are $1,525,000 for 10 years, with zero residual value at the end of 10 years. Under Plan B, Lemons Company would open three larger shops at a cost of $8,100,000. This plan is expected to generate net cash inflows of $1,050,000 per year for 10 years, the estimated usefullife of the properties. Estimated residual value for Plan B is $1,300,000. Lemons Company uses straight-line depreciation and requires an annual return of 7%. Requirement 1. Compute the payback, the ARR, the NPV, and the profitability index of these two plans. Calculate the payback for both plans. (Round your answers to one decimal place, X X) Caclulate the NPV (net present value) of each plan. Begin by calculating the NPV of Plan A. (Complete all answer boxes: Enter a "O" f parentheses or a minus sign for a nogative not present value.) Requirement 3. Which expansion plan should Lomons Company choose? Why? Lemons Company should invost in bocause it has at paybsck period, a ARR, a net present value, and a protitabitioy index: Requirement 4. Estimate Plan A's IFR. How does the IRR compare with the compani's required rate of rohum? Tho IPR (intornal rato of telurn) of Plan A is betwoen This rate the companys hurde rate of 7h