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Please help 1-6b Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a
Please help 1-6b
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 20% each of the last three years. He has computed the cost and revenue estimates for each product as follows: Product Product Initial investment: Cost of equipment (zero salvage value) $ 260,000 $470.000 Annual revenues and costst Sales revenues $ 310,000 $410,000 Variable expenses $ 144,000 $ 194,000 Depreciation expense $ 52,000 $94.000 Fixed out-of-pocket operating costs $ 76,000 $ 58,000 The company's discount rate is 18%. Click here to view Exhibit 128-1 and Exhibit:12B-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 project profitability Index for each product 5. Calculate the simple rate of return for each product 6. For each measure, identify whether Product A or Product B is preferred 66. Based on the simple rate of return, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Red 1 Reg 2 Reg 3 Req4 Reg 5 Reg 6 Reg 68 Calculate the payback period for each product. (Round your answers to 2 decimal places) 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 project 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 6. Based on the simple rate of return, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Reg 6A Reg 68 Calculate the payback period for each product. (Round your answers to 2 decimal places.) Product A Product Payback period years years Reg 2 > Od. dent AUCT BIS preterred. 6b. Based on the simple rate of return, Lou Barlow would likely: Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Reg 3 Reg 4 Req 5 Req 6A Reg 68 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 3.35 42:34 Click here to view Exhibit 128-1 and Exhibit 12B-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 project 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, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Reg Reg 4 Req1 Reg 6 Reg 2 Regs Reg 66 Calculate the internal rate of return for each product. (Round your answer to 1 decimal place le. 0.123 should be considered as 12.39) Product Product A % % Internal rate of retum Click here to view Exhibit 128-1 and Exhibit 128-2. 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 project 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, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Reqs Reg 6 Raq 615 Calculate the simple rate of return for each product. (Round your answer to 1 decimal place le. 0.123 should be considered as 12.3% Product A % Products % Simple rate of return Click here to view Exhibit 128-1 and Exhibit 128-2. 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 project 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, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Reqs Reg 6 Raq 615 Calculate the simple rate of return for each product. (Round your answer to 1 decimal place le. 0.123 should be considered as 12.3% Product A % Products % Simple rate of return The company's discount rate is 18% Click here to view Exhibit 128-1 and Exhibit 128-2, 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 project 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, Lou Barlow would likely. 1497 Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Req5 Req 6A Reg 68 For each measure, identify whether Product A or Product is preferred. Net Present Value Profitability Index Payback Period Internal Rate Simple Rate of of Return Return Reqs Reges > The company's discount rate is 18% Click here to view Exhibit 128-1 and Exhibit 128-2, 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 project 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, Lou Barlow would likely. 1497 Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Req5 Req 6A Reg 68 For each measure, identify whether Product A or Product is preferred. Net Present Value Profitability Index Payback Period Internal Rate Simple Rate of of Return Return Reqs Reges > 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 project 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. 66. Based on the simple rate of return, Lou Barlow would likely Complete this question by entering your answers in the tabs below. Reg 1 Reg2 Reg Req4 Reqs Reg 6 Heg 6 Based on the simple rate of return, Lou Barlow would likely: Accept Product A Accept Product B Reject both products RGA Step by Step Solution
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