The Ste. Marie Division of Pacific Media Corporation just started operations. It purchased depreciable assets costing $51 million and having a four-year expected life, after which the assets can be salvaged for $10.2 million. In addition, the division has $51 million in assets that are not depreciable. After four years, the division will have $51 million available from these nondepreciable assets. This means that the division has invested $102 million in assets with a salvage value of $61.2 million. Annual depreciation is $10.2 million. Annual operating cash flows are $26 million. Depreciation is computed on a straight-line basis, recognizing the salvage values noted. Ignore taxes. Assume that the division uses beginning-of-year asset values in the denominator for computing ROI. Required: a. & b. Compute ROI, using net book value and gross book value. (Enter your answers as a percentage rounded to 1 decimal place (i.e., 32.1).)

ROI

Net Book Value Gross Book Value

Year 1

Year 2

Year 3

Year 4