B2B Company is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment costs $144,000 and has a 12-year life and no salvage value. The expected annual income for each year from this equipment follows. Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Equipment Selling, general, and administrative expenses Income (a) Compute the annual net cash flow. (b) Compute the payback period. (c) Compute the accounting rate of return for this equipment. $ 90,000 48,000 12,000 9,000 $ 21,000 Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute the annual net cash flow. Annual Results from Investment Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Equipment Selling, general, and administrative expenses Income Net cash flow Income Cash Flow $ 90,000 $ 90,000 48,000 48,000 12,000 12,000 9,000 9,000 $ 21,000 $ 21,000 < Required A Required B > Required A Required B Required C Compute the payback period. Payback Period Numerator: Initial investment $ Denominator: Annual net cash flow = Payback period 144,000/$ 9,000 = 16.00 years < Required A Required C > Required A Required B Required C Compute the accounting rate of return for this equipment. Accounting Rate of Return Numerator: Annual income $ 1 Denominator: Average investment 21,000 $ = Accounting rate of return 57,000 = 36.84 %