Given data below to solve these questions.

  

1. A. Initial investment: $125,000 Sound Cellar Pro Gamer Net Cash Cumulative Net Net Cash Cumulative Net Flow Cash Flows Flow Cash Flows Year 1 $ 65,000 $ 65,000 $ 70,000 $ 70,000 Year 2 60,000 125,000 55,000 125,000 Year 3 25,000 150,000 35,000 160,000 Year 4 25,000 175,000 30,000 190,000 Year 5 45,000 220,000 30,000 220,000 The Sound Cellar magazine achieves payback in The Pro Gamer magazine achieves payback in Either magazine is recommended, based on the cash payback period. Year 2 Year 2 B. Net Present Value Analysis Present Net Cash Flow Present Value of Net Cash Flow Value of $1 at 10% Sound Cellar Pro Gamer Sound Cellar Pro Gamer Year 1 Year 2 Year 3 Year 4 Year 5 Total Amount to be invested Net present value magazine is recommended, based on its higher net present value.