The capital investment committee of Ellis Transport and Storage Inc. is considering two investment projects. The estimated income from operations and net cash flows from each investment are as follows: Warehouse Income from Net Cash Income from Year Operations Flow Operations Tracking Technology Net Cash Flow 1 $54,000 $175,000 $113,000 $280,000 2 54,000 175,000 86,000 236,000 3 54,000 175,000 43,000 166,000 4 54,000 175,000 19,000 114,000 5 54,000 175,000 Total $270,000 $875,000 9,000 $270,000 79,000 $875,000 Each project requires an investment of $540,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 12% for purposes of the net present value analysis. Present Value of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 0.890 0.826 0.797 0.756 0.694 3 0.840 0.751 0.712 0.658 0.579 4 0.792 0.683 0.636 0.572 0.482 5 0.747 0.621 0.567 0.497 0.402 6 0.705 0.564 0.507 0.432 0.335 7 0.665 0.513 0.452 0.376 0.279 8 0.627 0.467 0.404 0.327 0.233 9 0.592 0.424 0.361 0.284 0.194 10 0.558 0.386 0.322 0.247 0.162 Required: 1a. Compute the average rate of return for each investment. If required, round your answer to one decimal place. Warehouse Average Rate of Return % Tracking Technology % 1b. Compute the net present value for each investment. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. Present value of net cash flow total Less amount to be invested Net present value 2. The warehouse has a smaller Warehouse Tracking Technology net present value as tracking technology cash flows occur earlier would be the more attractive. the two projects can be accepted, the tracking technology in time. Thus, if only one of