Using the template provided, analyze the project #2 with Net Present Value, Internal Rate of Return, Payback Period, and Modified Payback Period.

Project #2: Expand concessions and gift shops

• Requires the purchase and customization of portable facilities and equipment, estimated to cost $772,500 upfront.
• In addition, again due to the seasonal and transitional nature of the circus industry, Jo Jo estimates that she will need to dedicate working capital of $10,500 at the beginning of the project. The $10,500 working capital will become available once the project's life is over.
• Jo Jo expects the project to yield positive net annual cash flows over the project's expected 6-year life as follows:
• End of 1st Year: $281,300
• End of 2nd Year: $259,000
• End of 3rd Year: $236,300
• End of 4th Year: $202,500
• End of 5th Year: $157,500
• End of 6th Year: $112,500
• Given Jo Jo's management team's experience with concessions and gift sales, Jo Jo feels confident that the net annual cash flows will be between 90% and 110% of the above estimates.
• Jo Jo expects to scrap the concession and gift shop facilities and equipment at the end of the 6 years for $8,000.

Jo Jo's investors require 15% return on their invested cash each year. The circus has managed to secure a tax haven such that they do not expect to pay any income taxes over the foreseeable future.