TIME: 3 HOURS INSTRUCTIONS: (100 MARKS) Answer ALL questions in the answer booklet (25 MARKS) QUESTION 1 A Combi Bhd is considering purchasing a machine that would cost RM201,600 and has a useful life of 9 years. The machine would reduce cash operating costs by RM37,334 per annum. The machine would have a salvage value of RM30,240 at the end of the project. Required: a) Compute the payback period for the machine (3 marks) b) Compute the simple rate of return for the machine (6 marks) B. Secta Enterprise's required rate of return is 8%. The company is considering the purchase of new machines that will be indicated below. Consider the machines independently Required: a) Machine A will cost RM20,000 and have a useful life of 10 years. Its salvage value of RM1,000, and cost savings are projected to be RM3,500. Compute the machine's present value. (7 marks) b) How much will Secta Enterprise be willing to pay for Machine B if the machine promises annual cash inflows of RM8,000 per year for 5 years (3 marks) C. Briefly explain THREE (3) strengths of the payback period (6 marks)