[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 $320,000 Investment for new machinery with a five-year life and no salvage value. Project Z requires a $320,000 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 $375,000 $300,000 Expenses Direct materials 52,500 37,500 Direct labor 75,000 45,800 Overhead including depreciation 135,000 135,000 Selling and administrative expenses 27,000 27,000 Total expenses 289,500 244,500 Pretax income 85,500 55,500 Income taxes (304) 25,650 16,650 Net Income $ 59,850 $ 38,850 Sales Problem 11-2A Part 1 Required: 1. Compute each project's annual expected net cash flows. Project Y Project 2 2. Determine each project's payback period. Choose Numerator Payback Period Choose Denominator: Payback Period Payback period 0 Project Project 2 0 3. Compute each project's accounting rate of return. Accounting Rate of Return Choose Numerator: 1 Choose Denominator: Accounting Rate of Return Accounting rate of return 1 Project Y Project Z 4. Determine each project's net present value using 6% as the discount rate. Assume that cash flows occur at each year-end. (Round your intermediate calculations.) Project Y Chart values are based on: Select Chart Amount PV Factor Present Value Net present value Project 2 Chart values are based on: JE Select Chart Amount X PV Factor Present Value Select Chart Amount PV Factor Present Value Net present value Project 2 Chart values are based on: ns Select Chart Amount X PV Factor Present Value Net present value