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Average Rate of Return The following data are accumulated by Watershed Inc. in evaluating two competing capital investment proposals: Project A Project Z Amount of investment $44,000 $84,000 Useful life 4 years 7 years Estimated residual value 0 0 Estimated total income over the useful life $3,520 $26,460 Determine the expected average rate of return for each project. Round your answers to one decimal place. Project A % Project Z % Determine Cash Flows Natural Foods Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The new garden tool is expected to generate additional annual sales of 9,700 units at $54 each. The new manufacturing equipment will cost $220,600 and is expected to have a 10-year life and a $16,900 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per-unit basis: Direct labor $9.20 Direct materials 30.00 2.10 Fixed factory overhead-depreciation Variable factory overhead 4.60 Total $45.90 Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use the minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answers to the nearest dollar. Natural Foods Inc. Net Cash Flows Years 2-9 Last Year Year 1 -220,600 Initial investment Operating cash flows: Annual revenues 523,800 Selling expenses -261,900 Cost to manufacture Net operating cash flows Total for Year 1 Total for Years 2-9 (operating cash flow) Residual value Total for last year