Lou Barlow, a divisional manager for Sage Company has an opportunity to manufacture and sell one of two new products for a five year period. His annual pay raises are determined by his division's return on investment (ROI), which has exceeded 18% each of the last three years. He has computed the cost and revenue estimates for each product as follows: Product Product $ 170,eee $ 380,000 Initial investment cost of equipment (zeco salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 250, $ 120,000 $ 34,000 $ 70,000 $350. $ 170.000 5 76,000 5 58,000 The company's discount rate is 16%. Click here to view Exhibit 14B-1 and Exhibit 14B-2. to determine the appropriate discount factor using tables, Required: 1. Calculate the payback period for each product 2 Calculate the net present value for each product 3 Calculate the internal rate of return for each product 4 Calculate the profitability index for each product 5. Calculate the simple rate of return for each product 6a For each measure identify whether Product A or Product is preferred 6. Based on the simple rate of return, which of the two products should Lou's division accept