$\backslash$table$[[,$PROJECT A$,$PROJECT B$],[$Initial investment,R$4000000,$R$4000000],[$Expected useful life,$5$ years,$5$ years$],[$Salvage value,$0,0],[$Cost of capital,$12\%,12\%],[$Depreciation per year,R$800000,$R$800000],[$Profit per year:,,$],[$Year $1,$R$300000,$R$360000],[$Year $2,$R$400000,$R$360000],[$Year $3,$R$800000,$R$360000],[$Year $4,$R$200000,$R$360000],[$Year $5,$R$100000,$R$360000]]$

QUESTIONS

Refer to the investment opportunities for $2026$ and calculate the following. Ignore taxes. Use only the four$-$decimals present value tables that appear after question $2\mathrm{.}3$ or in the module guide.

$2\mathrm{.}1$ Payback Period of both projects $($in years, moniths and days$).$

$(6$ Marks$)$

$2\mathrm{.}2$ Accounting Rate of Return on average investment of Project A $($expressed to two decimal places$).$

$(3$ Marks$)$

$2\mathrm{.}3$ Intermal Rate of Return of Project B $($expressed to two decimal places$).$ Your answer must include two net present value calculations $($using consecutive rates$/$percentages$)$ and interpolation.

$(5$ Marks$)$