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 21% each of the Jast three years. He has computed the cost and revenue estimates for each product as follows: Product A Product B Initial Investment: Cost of equipment (zero salvage value) $ 270,000 $ 480,000 Annual revenues and costs Sales revenues $ 320,000 $ 420,000 Variable expenses $ 148,000 $198.000 Depreciation expense $ 54,000 $ 96,000 Fixed out-of-pocket operating costs $ 27.000 $ 57,000 The company's discount rate is 19% Required (Use Excel for 2 . 4): 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 6a. For each measure, Identity whether Product A or Product is preferred Complete this question by entering your answers in the tabs below. Reg: Reg 2 Reg 3 Reg 4 Reg 6 Calculate the payback period for each product. (Round your answers to 2 decimal places.) Product A Payback period Product B years years Rae Req 2 > Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products year period. His annual pay raises are determined by his division's return on investment (ROI), which has exceeded 21% ea last three years. He has computed the cost and revenue estimates for each product as follows: Product A Product B $ 270,000 $ 480,000 Initial investment: Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 320,000 $ 148,000 $ 54,000 $ 77,000 $ 420,000 $ 198,000 $ 96,000 $ 57,000 The company's discount rate is 19% Required (Use Excel for 2.4): 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. 6a. For each measure, Identify whether Product A or Product B is preferred. Complete this question by entering your answers in the tabs below. Roq 1 Rog 2 Reg 3 Reg 4 Req 6A Using Excel, calculate the net present value for each product. (Round your final answers to the nearest whole dollar amount) Product A Product B Net present value Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two year period. His annual pay raises are determined by his division's return on investment (ROI), which has exce last three years. He has computed the cost and revenue estimates for each product as follows: Product A Product B $ 270,000 $ 480,000 Initial investment: Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 320,000 $ 148,000 $ 54,000 $ 77,000 $ 420,000 $ 198,800 $ 96,000 $ 57,000 The company's discount rate is 19%. Required (Use Excel for 2-4): 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. 6a. For each measure Identify whether Product A or Product B is preferred. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Req 6A Using Excel, calculate the internal rate of return for each product. (Round your percentage answers to 1 decimal place 0.123 should be considered as 12.3%) Product A Product B Internal rate of return % % Tasulee years. Has Compleu uie CUSCHHU Tevenue esnates TUI COLI pivuuLLOS TUTUW). Product A Product B $ 270,000 $ 480,000 Initial investment: Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 320,000 $ 148,000 $ 54,000 $ 77,000 $ 420,000 $ 198,000 $ 96,000 $ 57,000 The company's discount rate is 19%. Required (Use Excel for 2 - 4): 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. 6a. For each measure, identify whether Product A or Product B is preferred. les Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Req 6A Calculate the profitability index for each product. (Round your answers to 2 decimal places.) Product A Product B Profitability index pukeute LUST CHI Tevenue sur LES TUI COLI PIDUCOS IUHUVS. Product A Product B $ 270,000 $ 480,000 Initial investment: Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 320,000 $ 148,000 $ 54,800 $ 77,000 $ 420,000 $ 198,600 $ 96,000 $ 57,000 The company's discount rate is 19%. Required (Use Excel for 2-4): 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. 6a. For each measure, identify whether Product A or Product B is preferred. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Req 4 Req 6A For each measure, identify whether Product A or Product B is preferred. Net Present Profitability Payback Internal Rate Value Index Period of Return