Question

Helper|>/ MSN | Outlook, Off., | Suggested Sites Week 8: Homework i Saved 6 Casey Nelson is a divisional manager for Pigeon Company. His annual pay raises are largely determined by his division's return on investment (ROI), which has been above 23% each of the last three years. Casey is considering a capital budgeting project that would equire a $5,380,000 Investment in equipment with a useful life of five years and no salvage value Pigeon Company's discount rate is 15 9% The project would provide net operating income each year for five years as follows. points Sales $ 4, 800, 090 Skipped Variable expenses 2, 160,080 Contribution margin 2, 640,000 Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs $ 840,906 1, 076, 090 Book Depreciation Total fixed expenses 1 , 916, 080 Net operating income $ 724, 090 Ask Click here to view Exhibit 12B-1 and Exhibit 128-2, to determine the appropriate discount factor(s) using tables Required: Print 1 What is the project's net present value? 2 What is the project's internal rate of return to the nearest whole percent? 3. What is the project's simple rate of return? 4-a. Would the company want Casey to pursue this investment opportunity? References 4-b. Would Casey be inclined to pursue this investment opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Reg 3 Req 4A Req 4B What is the project's net present value? ( Round your final answer to the nearest whole dollar amount.) Net present value Req 2 >