$5\mathrm{.}1$

REQUIRED

Study the information given below and calculate the following questions. Ignore taxes.

$5\mathrm{.}1\mathrm{.}1$ payback period of project B $($expressed in years, months and days$)(3$ marks$)$

$5\mathrm{.}1\mathrm{.}2$ Accounting Rate of Return ion average investment of Project B $($expressed to two decimal places$)(4$ marks$)$

$5\mathrm{.}1\mathrm{.}3$ Net Present Value of Both Projects. Your answers must include the claculation of the present values and NPVs $(6$ marks$)$

INFORMATION

The following information relates to two capital investment projects under consideration by Kyro Limited:

Project A Project B

Initial cost R$800000$ R$800000$

Expected useful life $5$ year $5$ year

Scrap$/$Residual value R$1000000$

Depreciation per year R$140000$ R$160000$