Average rate of Retum Method, Net Present Value Method, and Analysis for a service company The capital investment committee of Arches Landscaping company is considering two capital investments. The estimated operating Income and het cash flows from each investment areas follows: Year 1 2 Front-End Loader Operating Net Cash Income Flow 539,900 5126,000 39,900 126,000 39,900 126,000 39,900 126,000 29,900 126,000 $199,500 8630,000 Greenhouse Operating Net Cash Income Flow 554,000 $202.000 64,000 170,000 32,000 120,000 14,000 82.000 5,500 56,000 $199,500 $630,000 3 4 5 Total Year Each project requires an investment of $420,000. Straight-in depreciation will be used, and no residual value is expected. The committee has selected a rate of 12% for purposes of the net present value analysis Present Value of $1 at Compound Interest 109 12% 15% 209 1 0.943 0.909 0.893 0.870 0.833 2 0.890 0.526 0.797 0.756 0.694 0.840 0.751 0.79 0658 0.579 4 0.792 0.536 0.482 5 0.747 0.621 0 567 0.49% 0.402 5 0.705 0.564 0507 0.432 0.335 7 0.665 0.513 0376 0.279 8 0.627 0.467 0.404 0.327 9 0.592 0.424 0236 0.254 0.194 10 0.558 0.366 02122 0.247 0102 572 0233 1b. Compute the net present value for each investment. Use the present value of $1 table above. If required, round to the nearest dollar. It required, use the minut sign to nicate negative ne present value Front-End Loader Greenhouse Present value of net cash flow X Amount to be invested Net present value 2. Prepare a brief report for the capital investment committee advising it on the relativements of the two investments The front-end onder hos present value because shows occur in me compared to the greenhouse. Thus, only one of the the projects can be accepted, the would be the more attractive