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 25% each of the last three years. He has computed the cost and revenue estimates for each product as follows: Product A Product B $ 340,000 $ 540,000 Initial investments Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs 3 390,000 $ 176,600 $ 68,000 84,800 $ 490,000 $ 226,000 $ 108,000 $ 64,900 The company's discount rate is 18%. 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 B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Answer is complete but not entirely correct. 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 B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? & Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Req 6A Reg 6B Based on the simple rate of return, which of the two products should Lou's division accept? Accept Product A Accept Product B Reject both produd INICI W VW LAOTIAILLE UUE OPUOLE LISCIOLI COCO 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 B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg 3 Regs Req 1 Reg 4 Req6A Req, 2 Reg 6B Calculate the net present value for each product. (Round your final answers to the nearest whole dollar amount.) Product A Product B $ 59,875 $ 89,208 Not present value W o ic LM e to search 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 B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reqs Reg 6 68 Calculate the internal rate of return for each product. (Round your percentage answers to 1 decimal place le. 0.123 should be considered as 12.39.) Product A Product B Interval rate of return 24 4 3 % 242 CIRCIE W VIEW LAILUI NU LALU, LU UCICHMIC LIC appropriate UISCOURILOCLOI umiy tavic 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 B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Req 6A Reg 66 Calculate the profitability Index for each product. (Round your answers to 2 decimal places.) Product A Product Protability index 1.18 1.17 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 tale of return for each product. 6a. For each measure Identify whether Product A or Product B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Reg1 Reg 2 Reg 3 Reg 4 Reg 5 Reg A Reg 68 Calculate the simple rate of return for each product. (Round your percentage answers to I decimal place le 0.123 should be considered as 1234) Product A 22.9 Product B 10.6 x Simple rate of return