3 value: 5.00 points Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five-year period. His annual pay raises are determined by his division's return on investment (ROI), which has exceeded 22% each of the last three years. He has computed the cost and revenue estimates for each product as follows Product A Product B Initial investment Cost of equipment (zero salvage value$370,000 Annual revenues and costs Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $570,000 $400,000 $480,000 $182,000 214,000 $ 74,000 114,000 $ 88,000 68,000 The company's discount rate is 20%. Click here to view Exhibit 11B-1 and Exhibit 11B-2, to determine the appropriate discount factor(s) using tables. Required 1. Calculate the payback period for each product. (Round your answers to 2 decimal places.) Product B Payback period years years Calculate the net present value for each product. (Use the appropriate table to determine the discount factor(s).) 2 Product A Product B Net present value 3. Calculate the project profitability index for each product. (Use the appropriate table to determine the discount factor(s). Round your answers to 2 decimal places.) Product A Product B Project profitability index 4. Calculate the simple rate of return for each product. (Round percentage answer to 1 decimal place. i.e. 0.1234 should be considered as 12.3% and use the appropriate table to determine the discount factor(s).) Product A Product B Simple rate of return 5a. For e ach measure, identify whether Product A or Product B is preferred . Net Present Profitability Payback Period Value ne Index