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 Tevenue estimates for each product as follows: Product A Product B Initial investment Cost of equipment (zero salvage value) $360,000 $530,000 Annual revenues and costs Sales revenues $400,000 5 510,000 Variable expenses $180,000 $ 250 000 Depreciation expense $ 72,000 $ 106,000 Fixed out-of-pocket operating costs $ 85,000 $ 65,000 The company's discount rate is 19% Use Excel or a financial calculator to solve any time value of money problems Required: 1. Calculate the payback period for each product. (Round your answers to 2 decimal places.) Product A Product B Payback period years years 2. Calculate the net present value for each product (Round answers to the nearest dollar) Product Products Net present value