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Need all required parts answered Problem 12-23 (Algo) Comprehensive Problem [LO12-1, L012-2, L012-3, LO12-5, LO12-6] Lou Barlow, a divisional manager for Sage Company, has an
Need all required parts answered
Problem 12-23 (Algo) Comprehensive Problem [LO12-1, L012-2, L012-3, LO12-5, LO12-6] 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 ralses are determined by his division's return on investment (ROI), which has exceeded 23% each of the last three years. He has computed the cost and revenue estimates for each product as follows: The company's discount rate is 14%. Click here to view Exhibit 128 - 1 and Exhibit 128-2, to determine the oppropriate discount foctor using tables. Required: 1. Calculate the payback period for each product. 2. Calculate the net present value for each product. 3. Calculate the intemal rate of retum 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? Complete this question by entering your answers in the tabs below. Calculate the payback period for each product. (Round your answers to 2 decimal placesi.) Calculate the net present value for each product. (Round your final answers to the nearest whole dollar a Calculate the internal rate of return for each product. (Round your percentage answers to 1 decimai place i.e. 0.123 should be considered as 12.306 ? Complete this question by entering your answers in the tabs below. Calculate the profitability index for each product. (Round your answers to 2 decimal places.) Calculate the simple rate of return for each product. (Round your percentage answers to 1 decimal place i.e. 0.1 . considered as 12.3%.) Complete this question by entering your answers in the tabs below. For each measure, identify whether Product A or Product B is preferred Step by Step Solution
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