Current Designs 25 a-d (Part Level Submission) A company that manufactures recreational pedal boats has approached Mike Cichanowski to ask if he would be interested in using Current Designs rotornold expertise and equipment to produce some of the pedalboat components. Mike is intrigued by the idea and thinks it would be an interesting way of complementing the present product line. One of Mike's hesitations about the proposal is that the pedal boats are a different shape than the kayaks that current Design produces. As a result, the company would need to buy an additional rotomold oven in order to produce the pedal boat components. This project clearly involves risks, and Mike wants to make sure that the returns justify the risks. In this case, since this is a new venture, Mike thinks that a 12% discount rate is appropriate to use to evaluate the project. As an intem at Current Designs, Mike has asked you to prepare an initial evaluation of this proposal. To aid in your analysis, he has provided the following information and assumptions. 1. 2. The new rotomold oven will have a cost of $275,000, a salvage value of $0, and an 8-year useful life. Straight line depreciation will be used. The projected revenues, costs, and results for each of the 8 years of this project are as follows. Sales $225,200 Less: $147,800 31,200 21,000 Manufacturing costs Depreciation Shipping and administrative costs Income before income taxes Income tax expense Net income 200,000 25,200 9.200 $16,000 Click here to view PV_table Sales $225,200 $147.800 31,200 21,000 Manufacturing costs Depreciation Shipping and administrative costs Income before income taxes Income tax expense Net income 200,000 25,200 9.200 $16.000 Click here to view Py table (a) Compute the annual rate of return. (Round answer to 2 decimal places, e.. 15.259.) Annual rate of return Click if you would like to Show Work for this question: Open Show Work By accessing this Question Assistance, you will learn while you earn points based on the Point Potential policy set by your instructor Attempts: 0 of 4 used SAVE FOR LATER SUBMIT ANSWER References Time Value of Money Table 1 Future Value of 1 Periods 4% 5% 6% 7% 8% 9 10% 11% 12% 15% 0 1.00000 100000 100000 100000 1.00000 100000 100000 100000 1.00000 1.00000 1 1.04000 1.05000 106000 1.07000 1.08000 1.09000 1.10000 1.11000 1.12000 1.15000 2 1 .08160 1.10250 1.12360 1.14490 1.16640 1.18810 1.21000 1.23210 1.25440 1.32250 3 1.12486 1.15763 1.19102 1.22504 1.25971 1.29503 1.33100 1.36763 1.40493 1.52088 4 1.16986 1.21551 1.26248 1.31080 1.36049 141158 1.46410 1.51807 1.57352 1.74901 5 1.21665 1.27628 1,33823 140255 1.46933 1.53862 1.61051 1.68506 1.76234 2.01136 1.26532 1.34010 1.41852 1.50073 1.58687 1.67710 1.77156 1.87041 1.97382 2.31306 7 1.31593 1.40710 1.50363 1.60578 1.71382 1.82804 1.94872 2.07616 2.21068 2.66002 1.36857 1.47746 1.59385 1.71819 1.85093 1.99256 2.14359 2.30454 2.47596 3.05902 1.42331 1.55133168948 1.83846 1.99900 2.17189 2.35795 2.55803 2.77308 3.51788 10 1.48024 1.62889 1.79085 1.96715 2.15892 2.36736259374 2.83942 3.10585404556 1.53945 1.60103 1.66507 1.73168 15 1.71034 1.89830 1.79586 2.01220 1.88565 2.13293 1.97993 2.26090 2.07893 2.39656 2.18287 2.54035 2.29202 2.69277 2.40662 2.85434 2.52695 3.02560 2.65330 3.20714 2.10485 233164 2.58043 285312 3.151763.47855 4.65239 2.25219 251817 2.81267 3.13843 3.49845 3.89598 5.35025 2.40985 2.71962 3.06581 3.45227 3.88328 4.36349 6.15279 2.57853 2.93719 3.34173 3.79750 4.31044 4.88711 7.07571 2.75903 3.172173.64248 4.17725 4.784595 .473573.13706 2.95216 3.42594 397031 459497 531089 6.13039 9.35762 3.15882 3.70002 4.32763 5.05447 5.89509 6.86604 10.76126 3.379933.99602 4.71712 5.55992 6.54355 7.68997 12.37545 3.61653 4.31570 5.141666 .11591 7.26334 8.61276 14.23177 3.86968 4.66096 5.60441 6.72750 8.06231 9.64629 16.36654 1.80094 1.87298 .94790 2.02582 .10685 2.19112 1 16 17 18 19 20 2 Table 2 Future Value of an Annuity of 1 (n) Payments 4% 5% 5% 6% 1.00000 1.00000 1.00000 2.04000 2.05000 2.06000 3.12160 3.15250 3.18360 7% 8% 1.000 1.00000 20700 2.08000 3.21493.24640 9% 100000 2.09000 3.27810 10% 100000 2.10000 3.31000 11% 100000 2.11000 3.34210 12% 15% 100000 1.00000 2.12000 2.15000 3.37440347250 vuje.willyplus.com/edugervplayer/reference/inderimode helplinkobject wygande 781119391609077Bitemidonopol References 4.24646 4.31013 4.374624.4399 4.50611 4.57313 4.64100 4.70973 4.77933 4.99338 5.41632 5.52563 5.637095.7507 5.86660 5.98471 6.10510 6.22780 6.35285 6.74238 6.63298 6.80191 6.97532 7.1533 7.33592752334 7.71561 7.91286 8.11519 8.75374 7.898298.14201 8.39384 8.6540 8.922809.200449.48717 9.78327 10.08901 11.06680 9.21423 9.54911 9.89747 10.2598 10.63663 11.02847 11.43589 11,85943 12.29969 13.72682 10.58280 11.02656 11.49132 11.9780 12.48756 13.02104 13.57948 14.16397 14.77566 16.78584 12.00611 12.57789 13.1807913.8164 14.48656 15.19293 15.93743 16.72201 17.54874 20.30372 13.4863514.20679 14.97164 15.7836 16.64549 17.56029 18.53117 19.56143 20.65458 24.34928 15.02581 15.91713 16.86994 17.8885 18.97713 20.14072 21.38428 22.71319 24.13313 29.00167 16.62684 17.71298 18.88214 20.1406 21.49530 22.95339 24.52271 26.21164 28.02911 34.35192 18.29191 19.59863 21.01507 22.55052421492 26.0191927.97498 30.09492 32.39260 40.50471 20.0235921.57856 23.27597 25.1290 27.15211 29.36092 31.77248 34,40536 37.27972 47.58041 21.82453 23.65749 25.67253 27.8881 30.32428 33.00340 35.94973 39.18995 42.75328 55.71747 23.69751 25.84037 28.21288 30.8402 33.7502336.97351 40.54470 44.50084 48.88367 65.07509 25.64541 28.13238 30.9056533.9990 37.45024 41.3013445.59917 50,39593 55.7497275.83636 27.6712330.53900 33.7599937379041 44626 46.01846 51.15909 56.93949 63.4396888.21181 W .com/d e/ she /index.uniimode helpon objecteweygand978111939160377 eferences 20 2 9.77808 33,06595 36.78559409955 45.76196 51.1601257.27500 64.202837205244 10244358 Table 3 Present Value of 1 (n)Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 15% 96154952389434093458 9259391743909099009089286 86957 2 92456 9070389000 8734485734 84168 8264581162.7971975614 .88900 8638483962 8163079383 77218.751327311971178 65752 .85480 82270 79209762907350370843 68301 658736355257175 82193 7835374726 7129968058 64993.62092 5934556743 49218 79031 74622 70496 66634 63017596275644753464 5066343233 .75992 71068.6650662275 583495470351316 481664523537594 .7306967684 62741 58201 54027 50187 46651 433934038832690 7025961461 59190 54393 5002546043 42410390923606128426 50835 463194224138554352132197 24719 64958 58468 52679 4750942888 38753 3504931728 2874821494 444013971135554 31863 28584 25668 18691 ererences .6005753032 4688441496 3677032618 2896625751 22917 16253 .57748 50507 44230 38782 34046 2992526333 23199 2046214133 55526 48102417273624531524 27454 23939 20900 1827012289 533914581139365338732918925187 21763 1882916312.10687 51337 43630 37136 3165727027 2310719785.1696314564 09293 49363 4155235034 29586 2502521199 1798615282.13004 08081 -47464 395733305127615 23171 19449 16351 13768 11611 07027 4563937689 31180 2584221455 17843 14864.124031036706110 19 7 Table 4 Present Value of an Annuity of 1 in) Payments 4% 5% 6 96154 95238 94340 185941 1.83339 2.27509 2.72325 267301 3.62990 3.54595 3.46511 4.45182 432943 421236 % 0% 10% 11% 12% 15% 93458 9259391743909099009089286 86957 1.80802 1.78326 1.75911 1.73554 1.21252169005 1.62571 2.02432 2.57710 2.53130 2.48685 2:44371 2.40183 2.28323 3.38721 3312133239723.16986 3.10245303735 2.85498 4.10020 3.99271 3.88965179079 3.69590 3.60478 335216 plus.com/eduger/player/references/indexunimode helpodinkobject wygande 73111919160177temidropolice ferences 00 3 5.24214 5.075694.91732 4.76654 4.62288 4.48592 4.35526 4.23054 4.11141 3.78448 6.00205 5.786375.58238 5.389295.20637 5.03295 4.86842 4.712204 .56376 4.16042 6.73274 6.46321 6.20979 5.97130 5.746645.53482 5.33493 5.14612 4.967644.48732 7.435337.10782 6.80169 6.51523 6.24689 5.99525 5.759025.53705 5.32825 4.77158 8.11090 7.72173 7.360097.02358 6.71008 6,41766 6.14457 5.88923 5.650225 .01877 8.76048 8.30641 7.88687 7.498677.13896 6.80519 6.49506 6.20652 5.93770 5.23371 9.38507 8.863258.38384 7.942697.53608 7.16073 6.81369 6.49236 6.19437 5.42062 9.98565 9.39357 8.85268 8.35765 7.90378 7.48690 7.10336 6.74987 6,42355 5.58315 10.56312 9.89864 9.294988.745478.24424 7.78615 7.36669 6.98187 6.62817 5.72448 11.11839 10.37966 9.71225 9.10791 8.55948 8.060697.60608 7.190876.810865.84737 11.65230 10.83777 10.10590 9.44665 8.85137 8.31256 7.823717.37916 6.97399 5.95424 12.16567 11.27407 10.47726 9.76322 9.12164 8.54363 8.02155 7.54879 7.11963 6.04716 12.65930 11.68959 10.82760 10.05909 9.37189 8.75563 8.2014 7.701627.24967 6.12797 13.13394 12.08532 11.15812 10.33560 9.60360 8.950128 .36492 7.839297.36578 6.19823 13.59033 12.46221 11.46992 10.59401 9.81815 9.12855 8.51356 7.96333 7469446.25933