The manager of a division that produces add-on products for the automobile industry had just been presented the opportunity to invest in two independent projects. The first is an air conditioner for back seats of vans and minivans. The second is a turbocharger. Without the investments, the division will have average assets for the coming year of $36 million and expected operating income of $5.4 million. The outlay required for each investment and the expected operating incomes are as follows: Air ConditionerTurbochargerOutlay$800,000$550,000Operating income$104,000$85,250 Required:NOTE: Please show supporting calculations for each stepa. Calculate the ROI for each of the two new projectsb. Compute the budgeted divisional ROI for each of the following four alternativesi. The air conditioner investment is madeii. The turbocharger investment is madeiii. Both investments are madeiv. Neither additional investment is madec. Assuming that divisional managers are evaluated and rewarded on the basis of ROI performance, which alternative do you think the divisional manager will choose?d. Suppose that the company sets a minimum required rate of return equal to 14%. Calculate the residual income for each of the following four alternativesi. The air conditioner investment is madeii. The turbocharger investment is madeiii. Both investments are madeiv. Neither additional investment is madee. Assuming that divisional managers are evaluated and rewarded on the basis of residual income, which alternative do you think the divisional manager will choose?f. Suppose that the company sets a minimum required rate of return equal to 10%. Calculate the residual income for each of the following four alternativesi. The air conditioner investment is madeii. The turbocharger investment is madeiii. Both investments are madeiv. Neither additional investment is madeg. Assuming that divisional managers are evaluated and rewarded on the basis of residual income, which alternative do you think the divisional manager will choose?