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The Ste. Marie Division of Pacific Media Corporation just started operations. It purchased depreciable assets costing 543 million and having a four-year expected life, after which the assets can be salvaged for 58.6 million. In addition, the division has 543 million in assets that are not depreciable. After four years the division will have $43 million available from these nondepreciable assets. This means that the division has invested $86 million in assets with a salvage value of $51.6 million Annual depreciation is $8.6 million Annual operating cash flows are 527 million Depreciation is computed on a straight-line basis, recognizing the salvage values noted. Ignore taxes. Assume that the division uses beginning-of-year asset values in the denominator for computing ROL Required: a. & b. Compute ROI, using net book value and gross book value. (Enter your answers as a percentage rounded to 1 decimal place (I.e., 32.1).) ROI Net Book Value Gross Book Value Year 1 23 Year 2 Year 3 Year 4 Upper Division of Lower Company acquired an asset with a cost of $580.000 and a four-year life. The cash flows from the asset, considering the effects of inflation, were scheduled as follows: Year Cash Flow 5200.000 255.000 200 000 315.000 The cost of the asset is expected to increase at a rate of 20 percent per year, compounded each year. Perfomance measures are based on beginning-of-year gross book values for the investment base Ignore taxes Required: a. What is the ROI for each year of the asset's life, using a historical cost approach? (Enter your answers as a percentage rounded to 1 decimal place (i.e., 32.1).) ROI Yea 1 Year 2 Year 3 Year 4 b. What is the ROI for each year of the asset's life if both the investment base and depreciation are determined by the current cost of the asset at the start of each year? (Enter your answers as a percentage rounded to 1 decimal place (i.e., 32.1).) ROI Year 1 Year 2 Year 3 Year 4