Managers at Acme Doohickey Co. are considering two projects.Project A: purchase and operation of a new machine, called theStarpunch, for manufacturing Acme doohickeys. The life of thisproject is three years. Project B: purchase and operation of a newmachine, called the Sunspot, for manufacturing Acme doohickeys. Thelife of this project is two years. The machines have identicalcapacity and produce the same doohickey. The company only has floorspace in its machinists’ shop for one machine. Assume that theappropriate discount rate in 8%, compounded annually. Identifywhich project, if either, managers should accept, and explain why.Table: Expected Cash Flows for Projects A and B Year A revenue Acosts A NCF B revenue B costs B NCF 0 ($35,000) ($30,000) 1 $25,000($10,000) $25,000 ($7,000) 2 $25,000 ($10,000) $25,000 ($8,000) 3$25,000 ($10,000) Note: the table lists net revenue and net costfor each project and each year. But the table is incomplete; youwill need to calculate the Net Cash Flows. Accept Project A. ItsNPV > 0. Also, when both of the project lifetimes are correctlyextended to 6 years, the Project A NPV = $6,559 which is greaterthan the Project B NPV = $3,218. Accept Project B. Its NPV > 0.In addition, its cost in each year is less than the correspondingcost for Project A. Reject both projects. When both of the projectlifetimes are correctly extended to 6 years, the NPV for eachproject is negative. Accept Project A. Its NPV > 0. Also, whenboth of the project lifetimes are correctly extended to 6 years,the Project A NPV = $3,656 which is greater than the Project B NPV= $1,241. Accept Project A. Its NPV > 0. Also, when both of theproject lifetimes are correctly extended to 6 years, the Project ANPV = $9,373 which is greater than the Project B NPV = $t,662.