information for two alternative projects involving machinery investments follows. project 1 requires an initial investment of $135,000. project 2 requires an initial investment of $98,000. annual amounts project 1 project 2 sales of new product $ 100,000 $ 80,000 expenses materials, labor, and overhead (except depreciation) 65,000 32,000 depreciation—machinery 20,000 18,000 selling, general, and administrative expenses 8,000 20,000 income $ 7,000 $ 10,000 (a) compute each project’s annual net cash flow. (b) compute payback period for each investment.
