A company is considering a five-year project that would require a $3,025,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: $2,737,000 1,001,000 1,736,000 Sales Variable expenses Contribution margin Fixed expenses Advertising, salaries, and other fixed out-of-pocket costs Depreciation Total fixed expenses Net operating income $610,000 605,000 1,215,000 $ 521,000 - What is the profitability index for this project? (Round your answer to 2 decimal places.) Profitability Index 3. What is the project's payback period? (Round your answer to 2 decimal places.) Project's payback period years A company produces two products Product sells for $170 and Product 2 sells for $130. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 116,000 units of each product Its average cost per unit for each product at this level of activity are given below. Product Product Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit $ 30 30 20 26 22 25 5153 5.10 -25 15 20 18 20 5124 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Consider each of the following questions separately 3. Assume the company normally produces and sells 100,000 unit of Product 2 per year. What is the financial advantage (disadvantage) of discontinuing Product 2? Financial (disadvantage)