QUESTION 2 (15 Marks) (5 marks) Study the information provided below and calculate the following: 2.1 Payback period of both Projects (answers expressed in years, months and days). Accounting Rate of Return of Project B (answer expressed to two decimal places). 2.3 Profitability index of both Projects (answers expressed to three decimal places). 2.2 (4 marks) (6 marks) INFORMATION Stratum Limited wants you to evaluate two projects which are under consideration for investment in 2022. The following information is available: Project A Project B Cost R220 000 R220 000 Scrap value Estimated useful life Cost of capital 15% 15% 0 0 4 years 4 years Net cash flows per year: R R End of: Year 1 70 000 Year 2 100 000 80 000 80 000 80 000 80 000 Year 3 90 000 Year 4 60 000 R R Net profit per year: End of: Year 1 15 000 Year 2 45 000 25 000 25 000 25 000 25 000 Year 3 35 000 Year 4 5 000