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Shimano Company has an opportunity to manufacture and sell one of two new products for a five-year period. The company's tax rate is 30% and

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Shimano Company has an opportunity to manufacture and sell one of two new products for a five-year period. The company's tax rate is 30% and its after-tax cost of capital is 12%. The cost and revemue estimates for each product are as follows: The equipment pertaining to both products has a useful life of five years and no salvage value. The company uses the straight-line depreciation method for financial reporting and tax purposes. At the end of flive years, each product's working capital will be relensed for invostment elsewhere within the compony. Click here to view Exhibie 78 a and Exhiblt 782. to determine the appropriate discount factor(s) using tables. Required: 1. Calculate the annual income tax expense for ench of years 1 through 5 that will arise if Product A is introduced. 2. Calculate the net present value of the investment opportunity pertaining to Product A. Note: Round your intermedlate calculations and final enswer to the nearest whole dollat. 3. Coiculate the annual income tax expense for each of years 1 through 5 that will arise If Product 8 is introduced 4. Calculate the net present value of the investment opportunity pertaining to Product B; Note: Round your intermediate calculations and final answer to the nearest whole dollar. 5-a. Calculate the profisability index for Product A and Product B. Notes Round your final answers to 3 decimal places 5.b. Eased on the profitability index of the two products, which one should the company pursue? 1. Calculate the annual income tax expense for each of years it through 5 that will arise if Product A is introduced. 2. Calcuilate the net present value of ine imvestinent opportunity pertaining to Product A. Notes Round your intermediate calculations and final answer to the nearest whole dollac, 3. Calculate the annual income tax expense for each of years 1 through 5 that will arise if Product 8 is introduced. 4. Calcutate the net present value of the investment opportunify pertaining to Product B. Notet Round your intermediate calculations and final answer to the nearest whole dollac, 5.a. Calculate the profitability index for Product A and Product B, Note: Round your final answers to 3 decimal places 5-b. Based on the profitablity index of the two products, which one should the company pursue

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