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Average Rate of Return Method, Net Present Value Method, and analysis for a flervice Company The capital investment Committee of the Transport and Storage Inc.

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Average Rate of Return Method, Net Present Value Method, and analysis for a flervice Company The capital investment Committee of the Transport and Storage Inc. is considering to investment projects. The estimated income from operations and are as follows cash flows from each investment Warehous Tracking Technology Income from Operations Income from Operations Flow I $ 61,400 $135.000 $ 34,400 $108.00 51,400 125,000 34.400 100,000 36,400 110,000 34.400 100,000 26.400 100.000 34.400 100,000 (3.600) 70.000 34,400 100.000 $172,000 $540,000 $172.000 $540,000 Each project requires an investment of $368,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 15% for purposes of the net present value analysis. Present Value of $1 at Compound Interest Year 646 1046 1290 150 204 0.943 0.909 0.893 0.870 0.833 0.890 0.826 0.797 0.614 0.540 0.792 0.747 0.233 0.592 0.55 0.163 Required: la Compute the average rate of return for each sment. If required, round your answer to one decimal Average Rate of Return Tracking Technology 1b. Compute the net present value for each investment. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest dollar Tracking Technology Present value of net cash flow total Amount to be invested et present value 2. The net present value exceeds the selected rate stablished for Quantitative factors the investment should be selected in lows (15%), while the does not. Thus, considering only

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