Average Rate of Return Method, Net Present Value Method, and Analysis The capital investment committee of Overnight Express Inc. is considering two investment projects. The estimated income from operations and net cash flows from each investment are as follows: Distribution Center Expansion Internet Tracking Technology Income from Net Income from Year Operations Cash Flow Operations Net Cash Flow 1 $42,000 $133,000 $88,000 $213,000 2 42,000 133,000 67,000 180,000 3 42,000 133,000) 34,000 126,000 4 42,000 133,000 15,000 86,000 5 42,000 133,000 6,000 60,000 Total $210,000 $665,000 $210,000 $665,000 Present Value of $1 at Compound Interesti Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893- 0.870 0.833 2 0.890 0.826 0.797 0.756 0.694 3 0.840 0.751 0.712 0.658 0.579 4 0.792 0.683 0.636 0.572 0.482 5 0.747 0.621 0.567 0.497 0.402 6 0.705 0.564 0.507 0.432 0.335 7 0.665 0.513 0.452 0.376 0.279 8 0.627 0.467 0.404 0.327 033 9 0.592 0.424 0.361 0.284 0.194 10 0.558 0.386 0.322 0.247 0.162 Each project requires an investment of $400,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 12% for purposes of the net present value analysis. Required: 1a. Compute the average rate of return for each investment. Round to one decimal place. Distribution Center Expansion Average Rate of Return Internet Tracking Technology 1b. Compute the net present value for each investment. Lee the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. Total present value of net cash flow Amount to be invested Net present value Distribution Center Expansion Internet Tracking Technology 2. The distribution center expansion offers average annual rate of return compared to the internet tracking technology. The does not. Thus, considering only quantitative net present value exceeds the selected rate established for discounted cash flows (12%), while the factors, the investment should be selected