properties. Estimated residual value is $$975,000.$ Happy Bean uses straight$-$line depreciation and requires an annual return of $10\%.$

$($Click the icon to view the present value annuity factor table.$)$

$($Click the icon to view the present value factor table.$)$

$($Click the icon to view the future value annuity factor table.$)$

$($Click the icon to view the future value factor table.$)$

Read the requirements.

Requirement $1.$ Compute the payback period, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting models?

Begin by computing the payback period for both plans. $($Round your answers to one decimal place.$)$

Requirements

Compute the payback period, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting models?

Which expansion plan should Happy Bean choose? Why?

Estimate Plan A$\text{'}$s IRR. How does the IRR compare with the company's required rate of retum?