Lilly, a manager at Lilly Pads, has an opportunity to manufacture and sell one of two new products. Her annual pay raises are determined by his division's ROI, which has exceeded 18% each of the last three years. She has computed the cost and revenue estimates for each of the new products as follows:

	Product A	Product B
Cost of investment (equipment)	$380,000	$270,000
Annual revenue and costs:
Sales revenue	$350,000	$255,000
Variable Expenses	$170,000	$110,000
Fixed Expenses, excluding depreciation	$50,000	$70,000
Depreciation Expense	$76,0000	$34,000
Life of product	5 years	7 years
Salvage value of new equipment at the end	10,000	5,000

The company's discount rate is 12%.

Required: 1a) Calculate the payback period for each product (round to two decimal places). 1b) Which product(s) would be acceptable if Lilly Pads requires a payback within 3 years? 2) Calculate the net present value for each product. 3a) Since the investments required are different, calculate the profitability index for each product (round to two decimal places). 3a) Which project should be selected if Lilly Pads only has resources to do one? 4) Calculate the internal rate of return (closest whole percentage) for each product (ignore salvage value). 5) Calculate the simple rate of return for each product.