a sales manager has the opportunity to sell one of two new products for a five year period. his annual pay raises are determined by his divisions return in investment, which has wxceded 22% each of the last three years. calculations of the cost and revenue for each product below.

Product A Product B $ 370,000 $ 570,000 Initial investment cost of equipment (zero salvage value) Annual revenues and costs Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 400,000 $ 180,000 S 74,000 S88,000 $ 480,000 $ 214,000 $ 114,000 $ 68,000 The company's discount rate is 20% DAMIT 140-1 Present Value of St WIL 22 233 9 10 Periods 4 6% 7% 93 10% 11 12% 10% th 1823 20% 20 254 1 0.962 0 952 0943 0.935 0.926 0.917 0.909 0901 0.893 0.885 0.877 0370 0.862 0.855 08470840 0533 0.826 0820 086 0806 0.800 2 0.925 0907 0.890 0.873 0,857 0.842 0.826 0812 0797 0.783 0789 0.756 0743 0731 070 0705 0.694 0683 0672 061 0650 0640 3 0889 0864 0.840 0.8 0.794 0.772 0751 0731 0.712 0.69 0.675 0.658 061 0624 0.609 0.593 0.579 0564 0.551 0.5370524 0512 4 0.855 0823 0.792 0.763 0735 0.708 0.683 0,659 0.636 0.61 0.592 0.572 0552 0534 059 0.499 0482 0.667 0.451 0.437 0423 0.410 5 0822 0.784 0747 0.73 0681 0650 0621 0.593 0567 0.543 059 0497 0478 0.456 0437 0.419 0402 0.386 0.370 0355 0341 0.128 5 0.750 0.746 0.705 0.666 0.630 0.396 0.564 0535 0.507 0.480 0456 0.432 0.40 0.390 0370 0.352 0.335 0.319 0.303 0.289 0275 0.262 7 0.750 0711 0.665 0.623 0583 0547 050 0482 0.452 0425 0.400 0.376 0.354 0.333 0.31 0.296 0.279 0263 0249 0.235 0.272 0210 0.731 0.677 0.627 0.582 0540 0502 04670434 0.404 0.376 0.351 0327 0.305 0285 0265 0.249 0.233 0218 0.204 0191 0.179 0.968 0.7030645 0.592 0.544 0.500 0.400 0.424 0.391 0361 0.3 0.308 0.284 025 0243 0225 0.209 0194 0.00 0.167 0.155 0144 0134 0.67 0.614 0.558 SOB 043 0422 0.386 0.352 0.322 0.295 0270 0.247 0227 0208 0191 0.16 0.162 0.549 007 0.120 0.116 0.507 11 0.650 0.585 0.527 0.4750429 0.38 0.350 0317 0.287 0.20 0.23 0.215 0.195 0178 0.802 0.148 0.005 0123 0.112 0.003 0.094 0006 12 0.625 0.557 0.497 0.446 0397 0356 0.319 0.286 0.257 0.21 0.20 0587 0.160 0.152 0.137 0124 0.112 0.02 0.092 0.003 0.076 0089 12 0.601 0.500 0.400 0.415 030 0.326 0.290 0.2580229 0.2040102013 044501300116 0104 0.093 0.084 0.075 0.000 0.001 0.055 14 0.57 0.505 0442 0.3 0.30 0.299 0.260 022 0.205 0101 010 000125011 0.0000 0078 0069 0.062 0.055 0.049 0044 15 0.555 04014 0362 0.15 0275 0.230 0209 09 0.500 OMO 0123 000 0005 004 0074 0.065 0057 0.0510045 0.000 0.035 0534 0.456 0394 0.33 0.292 020202 0188 0100 0101 0123 0.107 0000 0001 007 0.002 0.054 0.047 00420036 0032 0.028 1 050 0436 0.31 0.31 0.270 02:31 01930100145 0125 000 000 0000 0000 0000 0052 0045 0,009 0.034 0.00 0,026 0.023 0.000416 0.350 0290 0.250 0212 036 0153 0130 om 0.005 on 0.000 0.05 0.051 0044 0.038 0.0320028 0.024 0.021001 0.475 0.06 0.3010277 0232 0164 0164 0138 0110 0098 0000 000 0.000 0.091 000 0.037 0,031 0.027 0023 0.020 0010014 20 0456 0.3770312 0.250 0.215 0.170 0.149 0.1240104 0.007 0073 0001 0.051 0.00 0.037 0.001 0.026 0,092 0.019 0016 0014 000 21 0439 0.359 0.24 0.2420199 0.154 01350112 0.093 0.00 0.001 0.053 0044 0.037 0.031 0.026 0.022 001800150013 con 0.000 0422 0.342 0.278 0.226 01B4 01500123 0301 03 0.000 0.056 0016 0.033 0032 0.026 0022 0.018 0.015 000 0.011 0.000 0.007 23 0406 0.375 0.22 0.21 0.170 033 0112 0.091 004 00000019 000 0.033 0.027 0022 0.018 0.0050012 0.010 0.000 0.007 0.006 0.190 0.30 0.247 0.1070150006 002 0082 0006 0053 0003 0025 0.025 0.023 0019 0.015 0013 0010 0000 0.007 0.006 0.005 0.375 0295 0.2330104 0146 0.115 0092 0.04 00500047 0.038 0.030 0.024 00200016 0.03 0010 0009 0.007 0.006 0.005 0.004 20 0361 0.21 02200172 01350106 0064 0.066 0063 0042 0.030 0.025 0.021 0.017 0.014 0.00 0.009 0.007 0.006 0.005 0.004 0.003 0347 0.20 0.207 0.61 0.125 0.098 007 0060 0,047 0.037 0.029 0.023 0018 0.014 001 0.000 0.007 0006 0.005 0004 0.0000002 0333 0255 0.96 0150 0116 0090 0.009 0054 0.042 0.033 0.025 0.020 0.01 0.012 0.010 0008 0,006 0.005 0.001 0.00 0.0020002 0321 0.2430185 0.141 0.007 0082 0063 0048 0.037 0,029 0.022 0.017 0010011 0.008 0.006 0005 0.004 0.003 0.002 0.002 0.002 30 30 0.231 0174 0099 007 0057 0.04 0.003 0026 0020 0,015 0,012 0.000 0.007 0.005 0.001 0.003 0.003 0002 0002 0.001 40 age 0142 0,097 0,067 0.046 0032 0.022 0.01 0.0110.008 0.005 0.004 0.003 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 LCIO DOBIT 148-2 Present Value of an Annulty of $1 In Artes Arrears -- Periods 1 2 3 4 5 6 5.002 B 9 10 TI 12 14 53 6% 735 8% 9% 10% 17% 12% 3% 15% 16% 17% 20% 23% 25% 25 0.962 0.9520,943 0.935 0.926 0.917 0909 0.901 0.893 0885 0.87708700862 0.855 0.847 0.840 0833 0826 0820 081 0806 0.800 1836 1859 1833 1808 1783 1759 1735 173 1690 1668 1647 1.626 1605 1.5851566 1547 1.528 1509 1492 1474 1457 1400 2775 2723 2673 2624 2577 2531 2487 2444 2402 2361 2322 2283 2246 2210 2174 2.140 2.106 2074 2042 200 1.981 1952 3630 3546 3.465 3.387 3.312 3200 3.170 302 3037 2.974 2.9 2855 2798 2743 2.690 2.639 2589 2540 2494 2448 2404 2362 4452 4329 4212 4100 3993 3.890 3.791 3696 3.605 3.517 3.433 3352 3274 3199 3127 3.058 2991 2926 2864 2803 2745 2689 5.242 5076 4917 4.767 4623 4486 4355 4231 4.111 3.998 3.889 3.784 3.685 3589 3.490 3.410 3.326 3245 3967 3.092 3020 2951 5738 5582 5.389 5.206 5.033 458 4712 4564 4423 4.289 4100 4039 3.922 3.812 37063605 3.508 3.416 3327 32423161 6733 6.463 6.210 5.971 5747 5.535 5.335 5.146 4.968 4799 4639 4487 4344 4.207 4.078 3954 3.837 3.7263619 3.518 3421 3.229 7435 7108 6.802 6.515 6 247 5.995 5.759 5.837 5.328 5.132 49464772 4.607 4451 4.308 47534031 3.905 3.786 3673 35663483 3:11 2.722 7360 7024 6.710 6.418 6145 5.889 5650 5.426 5.2163.019 4.833 4659 4494 43394192 40543923 3.7993662 3571 B.760 8.306 7887 7490 709 6905 6.495 6.207 5.939 5.687 5453 5.2314 5029463646564456 4.327 477 4.035 3.902 3.776 3650 9.385 8.853 0.384 7963 2536 7101 0814 6.492 6194 5.919 5650 5.421 5197 4998 4733 4011 4.439 4278 4127 39853.8563725 9986 9.394 8.853 8.358 7.904 7.487 7103 6750 6424, 61225842 5.583 5.342 5.115 4910 4715 4533 4352 4203 405339122730 30.563 9.099 9.295 8745 8.244 2780 73676962 6.625 6202 6002 5724 5.408 5.229 5.000 4.102 4011 4432 426541083.962 3824 11.118 10.3809712 9108 8.559 1.061 7605 2191 6811 6462 6142 58475575 5.324 5.092 4876 4.675 449 415 4153400110 11652 10.898 10:00 9447 8.351 0.30 70247379 6974 601 6.2655 9545008 540 552 4938 4230 45364357 4190 401332 12.106 11,274 10477 9.703 9122 3544 3.022 7543 7120 672051736047 5740 475 5.222 4.990 477545704.391 4210 4.050 1.910 12,659 1690 10821100509.372 0.750 0.201 7702 7.250 6340 0.467 0128 834 5.2735033 40124.000 4419 424340803928 11134 12.05 11158 10.3369604950 3.365 7830 7300 6.008 650 6160077 5.8 5.310 5070 4.10 4635 4442 426 40071012 13.500 12.462 114701059490139129 BUM7063240970256.623 6.259 59265.625.53 5101 4070 4.657 4400 427940 1994 1402912.821 107 10830 10.017 9.292 3.648 075 7562 702 6:08) 03125,973 5.005 5384 5127 4.891 4675 44704292 4121 3.63 14.65113163 12.042 11001 10 201 9.442 8.772 6.170.76457170 6.740 6.959 601 5095 5410 5149 49094.690 443 4302 4003970 14.857 1489 12.30311272 10.371 9.580 8.03.2007 7230 6.792 6.399 6044 5723 5.432 5167 4925 47034499 4311 2020 15 247 13799 12.550 11.489 10529 9707 8.985 8340784 2283 635 6.494 0.073 5746 5.451 5132 4.937 413 4.507 4313 41433981 15 622 14004 12.78311654 106759023 9.07784227843733088736451 6.097 5.766 3.467 5.15 1948 4721 45144322 417 2985 15.983 14375 13.003 1026 0.8109,929 101 8.488 2896 2372 6 900 0.491 118 5783 5.4110 5.200 4 956 4728 4520 41214751 3.08 330 1464 13:21 1987 10.935 10021 4237 8.540 7943 7109 6 935 6514 6136 5.79 5.492 5215 4 964 4734 4.524 433241543900 16.663 14895 13.406 12.137 11.051 10.10 9.307 8.602 7934 7441 6901 6.534 6.152 5810 5.502 5223 4970 4.73945284335 4157 1992 15.884 15.11 13591 12.278 11158 10.08 9.370 650 0.022 7470 69836561 6166 5820 5.510 5229 49754740 4531 43074 1904 17.292 15372 13705 12.409 11258 10 2749.427 3694 8.055 749670036.566 6.177 5.829 5517 5.235 4.9794645344194100 19.793 12159 15.046 1333211.025 10.757 9.779 9.951 8244 7634 71056642 6233 5.871 5540 5.258 49974780 454347 4.908 2009 10 17 10 10 20 21 22 23 25 20 20 30 40 Required: 1. Calculate the payback period for each product. 2. Calculate the net present value for each product. 3. Calculate the internal rate of return for each product. 4. Calculate the profitability index for each product. 5. Calculate the simple rate of return for each product. 6a. For each measure. Identify whether Product A or Product B is preferred