Assume Fanning Modems, Inc., is a division of Gilmore Business Products (GBP). GBP uses ROI as the primary measure of managerial performance. GBP has a desired return on investment (ROI) of 4.20 percent. The company has $150,000 of investment funds to be assigned to its divisions. The president of Fanning is aware of an investment opportunity for these funds that is expected to yield an ROI of 4.40 percent. Income Statement Sales revenue Cost of goods sold Gross margin Sales commission Depreciation expense Administrative expense $ 650,000 (480,000) $ 170,000 (35,000) (14,000) (72,950) $ 48,050 Net income Balance Sheet Assets: Cash Manufacturing equipment, net of accumulated depreciation Office equipment, net of accumulated depreciation Total assets Equity: Common stock Retained earnings Total equity $716,050 240,000 32,000 $988,050 $940,000 48,050 $988,050 Required a-1. Calculate the existing ROI for Fanning. a-2. Based on your computations will the President of Fanning accept or reject the $150,000 investment opportunity? C-1. Calculate the estimated residual income of the new investment opportunity. c-2. Based on the residual income would the President of Fanning accept or reject the $150,000 investment opportunity? Complete this question by entering your answers in the tabs below. Req A1 and A2 Req C1 and C2 Calculate the existing ROI for Fanning. Based on your computations will the President of Fanning accept or reject the $150,000 investment opportunity? (Round your answer to 2 decimal places. (i.e., .2345 should be entered as 23.45).) a-1. TROI % a-2. Based on your computations, will the President of Fanning accept or reject the investment opportunity? Req A1 and A2 Req C1 and C2 > Required a-1. Calculate the existing ROI for Fanning. a-2. Based on your computations will the President of Fanning accept or reject the $150,000 investment opportunity? C-1. Calculate the estimated residual income of the new investment opportunity. C-2. Based on the residual income would the President of Fanning accept or reject the $150,000 investment opportunity? Complete this question by entering your answers in the tabs below. Req A1 and A2 Req C1 and C2 Calculate the estimated residual income of the new investment opportunity. Based on the residual income would the President of Fanning accept or reject the $150,000 investment opportunity? Residual income 1. C- 2. Based on residual income, would the President of Fanning accept or reject the investment opportunity?