1 Required information Saved Help Save & Exi Problem 24-2A (Algo) Payback period, accounting rate of return, net present value, and net cash flow calculation LO P1, P2, P3 [The following information applies to the questions displayed below.] Project Y requires a $328,500 investment for new machinery with a four-year life and no salvage value. The project yields the following annual results. Cash flows occur evenly within each year. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income Project Y $ 380,000 170,240 82,125 27,000 $ 100,635 Problem 24-2A (Algo) Part 1 Required: 1. Compute Project Y's annual net cash flows. S Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income Net cash flow 69 $ Income 380,000 Cash Flow: $ 59 170,240 82,125 27,000 100,635 $ 69 0 2 2 of 4 Problem 24-2A (Algo) Part 2 2. Determine Project Y's payback period. Book Project Y rint rences Numerator: Payback Period Denominator: H Payback Period 0 Problem 24-2A (Algo) Part 3 3. Compute Project Y's accounting rate of return. Project Y Numerator: Accounting Rate of Return Denominator: Accounting Rate of Return 0 13 + Problem 24-2A (Algo) Part 4 4 of 4 4. Determine Project Y's net present value using 6% as the discount rate. (Do not round intermediate calculat present value factor to 4 decimals and final answers to the nearest whole dollar.) Years 1-6 -Book Print erences Net present value Net Cash Flows X Present Value of Annuity at 6% == Present Value of Net Cash Flows == $ 69 0