The management of Foxface School plans to install pop corn vending machines in its school. Annual sales of pop corn are estimated at 3,000 units at a price of P 8 per unit.Variable costs are estimated at P 3 per unit, while incremental fixed costs, excluding depreciation, at P 2,000 per year. Foxface will acquire three vending machines at P 10,000 each, including installation costs of P 1,000 per machine.The machines are expected to have a service life of 5 years, with no salvage value. Depreciation will be computed on a straight-line basis.The company's income tax rate is 30%.

1. What is the increase in annual net income of Foxface if the pop corn vending machines were installed.
2. What is the annual net cash inflows that will be generated by the project.