ABC Ltd. is evaluating a project requiring an initial investment of Rs. 5,00,000. The project will have a life of 6 years with no salvage value. The expected profit after depreciation but before tax during the life of the project is as follows:

Year	1	2	3	4	5	6
Rs.	50,000	70,000	60,000	80,000	100,000	120,000

The project will be depreciated at 10% on original cost. The company is subjected to 25% tax rate.

Required:

1. Calculate PBP and ARR.
2. Calculate NPV and NPV Index, if cost of capital is 12%.
3. Calculate IRR.
4. Determine the profitability index.
5. Analyze if the project should be accepted based on NPV and IRR.