with this is better?

Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products year period. His annual pay raises are determined by his division's return on investment (ROI), which has exceeded 19% ea last three years. He has computed the cost and revenue estimates for each product as follows: Product A Product B $ 180,000 $ 390,000 Initial investment: Cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket operating costs $ 270,000 $ 130,000 $ 44,000 $ 80,000 $ 360,000 $ 180,000 $ 86,000 $ 60,000 The company's discount rate is 16%. Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor using tables. Required: 1. Calculate the payback period for each product. 2. Calculate the net present value for each product. 3. Calculate the internal rate of return for each product. 4. Calculate the profitability index for each product. 5. Calculate the simple rate of return for each product. 6a. For each measure, identify whether Product A or Product B is preferred. 6b. Based on the simple rate of return, which of the two products should Lou's division accept? Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Reg 3 Req 4 Reg 5 Req 6A Req 6B Calculate the payback period for each product. (Round your answers to 2 decimal places.) Product A Product B Payback period years years Req 1 Req 2 Req 3 Req 4 Req 5 Req 6A Req 6B Calculate the net present value for each product. (Round your final answers to the nearest whole dollar amo Product A Product B Net present value Req 1 Reg 2 Reche Req 4 Req 5 Reg 6A Req 6B Calculate the internal rate of return for each product. (Round your percentage answers to 1 decimal place i.e. 0.123 she considered as 12.3%.) Product A Product B Internal rate of return % % Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4 Req 5 Reg 6A Reg 6B Calculate the profitability index for each product. (Round your answers to 2 decimal places.) Product A Product B Profitability index below. Req 1 Req 2 Reg 3 Req 4 Reg 5 Req 6A Req 6B Calculate the simple rate of return for each product. (Round your percentage answers to 1 decimal place i.e. 0.123 shou considered as 12.3%.) Product A Product B Simple rate of return % % alliswers in the tabs below. Req 1 Req 2 Req 3 Reg 4 Req 5 weg 6A Reg 6B For each measure, identify whether Product A or Product B is preferred. Net Present Value Profitability Index Payback Period Internal Rate Simple Rate of of Return Return Req 1 Req 2 Req 3 Reg 4 Reg 5 Reg 6A Reg 6B Based on the simple rate of return, which of the two products should Lou's division accept? Accept Product A Accept Product B Reject both products EXHIBIT 14B-1 Present Value of $1:1(1+r)n 13% Periods 1 -I 0.806 2 6% 0.943 0.890 0.840 0.792 0.747 3 4 S 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 4% 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 0.676 0.650 0.625 0.601 0.577 0.555 0.534 0.513 0.494 0.475 0.456 0.439 0.422 0.406 0.390 0.375 0.361 0.347 0.333 0.321 0.308 0.208 5% 0.952 0.907 0.864 0.823 0.784 0.746 0.711 0.677 0.645 0.614 0.585 0.557 0.530 0.505 0.481 0.458 0.436 0.416 0.396 0.377 0.359 0.342 0.326 0.310 0.295 0.281 0.268 0.255 0.243 0.231 0.142 7% 0.935 0.873 0.816 0.763 0.713 0.666 0.623 0.582 0.544 0.508 0.475 0.444 0.415 0.388 0.362 0.339 0.317 0.296 0.277 0.258 0.242 0.226 0.211 0.197 0.184 0.172 0.161 0.150 0.141 0.131 0.067 0.705 0.665 0.627 0.592 0.558 0.527 0.497 0.469 0.442 0.417 0.394 0.371 0.350 0.331 0.312 0.294 0.278 0.262 0.247 0.233 0.220 0.207 0.196 0.185 0.174 0.097 8% 0.926 0.857 0.794 0.735 0.681 0.630 0.583 0.540 0.500 0.463 0.429 0.397 0.368 0.340 0.315 0.292 0.270 0.250 0.232 0.215 0.199 0.184 0.170 0.158 0.146 0.135 0.125 0.116 0.107 0.099 0.046 9% 10% 0.917 0.909 0.842 0.826 0.772 0.751 0.708 0.683 0.650 0.621 0.596 0.564 0.547 0.513 0.502 0.467 0.460 0.424 0.422 0.386 0.388 0.350 0.356 0.319 0.326 0.290 0.299 0.263 0.275 0.239 0.252 0.218 0.231 0.198 0.212 0.180 0.194 0.164 0.178 0.149 0.164 0.135 0.150 0.123 0.138 0.112 0.126 0.102 0.116 0.092 0.106 0.084 0.098 0.076 0.090 0.069 0.082 0.063 0.075 0.057 0.032 0.022 11% 0.901 0.812 0.731 0.659 0.593 0.535 0.482 0.434 0.391 0.352 0.317 0.286 0.258 0.232 0.209 0.188 0.170 0.153 0.138 0.124 0.112 0.101 0.091 0.082 0.074 0.066 0.060 0.054 0.048 0.044 0.015 12% 14% 0.893 0.885 0.877 0.797 0.783 0.769 0.712 0.693 0.675 0.636 0.613 0.592 0.567 0.543 0.519 0.507 0.480 0.456 0.452 0.425 0.400 0.404 0.376 0.351 0.361 0.333 0.308 0.322 0.295 0.270 0.287 0.261 0.237 0.257 0.231 0.208 0.229 0.204 0.182 0.205 0.181 0.160 0.183 0.160 0.140 0.163 0.141 0.123 0.146 0.125 0.108 0.130 0.111 0.095 0.116 0.098 0.083 0.104 0.087 0.073 0.093 0.077 0.064 0.083 0.068 0.056 0.074 0.060 0.049 0.066 0.053 0.043 0.059 0.047 0.038 0.053 0.042 0.033 0.047 | 0.037 0.029 0.042 0.033 0.026 0.037 0.029 0.022 0.033 0.026 0.020 0.011 0.008 0.005 15% 0.870 0.756 0.658 0.572 0.497 0.432 0.376 0.327 0.284 0.247 0.215 0.187 0.163 0.141 0.123 0.107 0.093 0.081 0.070 0.061 0.053 0.046 0.040 0.035 0.030 0.026 0.023 0.020 0.017 0.015 0.004 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 0.125 0.108 0.093 0.080 0.069 0.060 0.051 0.044 0.038 0.033 0.028 0.024 0.021 0.018 0.016 0.014 0.012 0.003 17% 18% 19% 0.855 0.847 0.840 0.731 0.718 0.706 0.624 0.609 0.593 0.534 0.516 0.499 0.456 0.437 0.419 0.390 0.370 0.352 0.333 0.314 0.296 0.285 0.266 0.249 0.243 0.225 0.209 0.208 | 0.191 0.176 0.178 0.162 0.148 0.152 0.137 0.124 0.130 0.116 0.104 0.111 0.099 0.088 0.095 0.084 0.074 0.081 0.071 0.062 0.069 0.060 0.052 0.059 0.051 0.044 0.051 0.043 0.037 0.043 0.037 0.031 0.037 0.031 0.026 0.032 0.026 0.022 0.027 0.022 0.018 0.023 0.019 0.015 0.020 0.016 0.013 0.017 0.014 0.011 0.014 0.011 0.009 0.012 0.010 0.008 0.011 0.008 0.006 0.009 0.007 0.005 0.002 0.001 0.001 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279 0.233 0.194 0.162 0.135 0.112 0.093 0.078 0.065 0.054 0.045 0.038 0.031 0.026 0.022 0.018 0.015 0.013 0.010 0.009 0.007 0.006 0.005 0.004 0.001 21% 0.826 0.683 0.564 0.467 0.386 0.319 0.263 0.218 0.180 0.149 0.123 0.102 0.084 0.069 0.057 0.047 0.039 0.032 0.027 0.022 0.018 0.015 0.012 0.010 0.009 0.007 0.006 0.005 0.004 0.003 0.000 22% 0.820 0.672 0.551 0.451 0.370 0.303 0.249 0.204 0.167 0.137 0.112 0.092 0.075 0.062 0.051 0.042 0.034 0.028 0.023 0.019 0.015 0.013 0.010 0.008 0.007 0.006 0.005 0.004 0.003 0.003 0.000 23% 0.813 0.661 0.537 0.437 0.355 0.289 0.235 0.191 0.155 0.126 0.103 0.083 0.068 0.055 0.045 0.036 0.030 0.024 0.020 0.016 0.013 0.011 0.009 0.007 0.006 0.005 0.004 0.003 0.002 0.002 0.000 24% 25% 0.800 0.650 0.640 0.524 0.512 0.423 0.410 0.341 0.328 0.275 0.262 0.222 0.210 0.179 0.168 0.144 0.134 0.116 0.107 0.094 0.086 0.076 0.069 0.061 0.055 0.049 0.044 0.040 0.035 0.032 0.028 0.026 0.023 0.021 0.018 0.017 0.014 0.014 0.012 0.011 0.009 0.009 0.007 0.007 0.006 0.006 0.005 0.005 0.004 0.004 0.003 0.003 0.002 0.002 0.002 0.002 0.002V 0.002 0.001 0.000 0.000 wolol L I 30 40 EXHIBIT 14B-2 Present Value of an Annuity of S1 in Arrears; 10[1-1(1+r)n] 6% 21% LL Periods 4% 5% 7% 8% 9% 10% 1 0.962 0.952 0.943 0.935 0.926 0.917 0.909 2 1.886 1.859 1.833 1.808 1.783 1.759 1.736 3 2.775 2.723 2.673 2.624 2.577 2,531 2.487 4 3.630 3.546 3.465 3.387 3.312 3.240 3.170 5 4.452 4.329 4.212 4.100 3.993 3.890 3.791 6 5.242 5.076 4.917 4.767 4.623 4.486 4.355 7 6.002 5.786 5.582 5.389 5.206 5.033 4.868 8 6.733 6.463 6.210 5.971 5.747 5.535 5.335 9 7.435 7.108 6.802 6.515 6.247 5.995 5.759 10 8.111 7.722 7.360 7.024 6.710 6.418 6.145 11 8.760 8.306 7.887 7.499 7.139 6.805 6.495 12 9.385 8.863 8,384 7.943 7.536 7.161 6.814 13 9.986 9.394 8.853 8.358 7.904 7.487 7.103 14 10.563 9.899 9.295 8.745 8.244 7.786 7.367 15 11.118 10.380 9.712 9.108 8.559 8.061 7.606 16 11.652 10.838 10.106 | 9.447 8.851 8.313 7.824 17 12.166 | 11.274 10.477 | 9.763 9.122 8.544 8.022 18 12.65911.690 10.828 10.059 9.372 8.756 8.201 19 13.134 | 12.085 | 11.158 10.336 9.604 8.950 8.365 20 13.590 | 12.462 11.470 10.5949.818 9.129 8.514 21 14.029 12.821 11.764 10.836 10.017 9.292 8.649 22 14.451 13.163 12.042 11.061 10.201 9.442 8.772 23 14.857 13.489 12.303 11.272 10.371 9.580 8.883 24 15.247 | 13.799 12.550 11.469 10.529 9.707 8.985 25 15.622 14.094 | 12.783 | 11.654 10.675 9.823 9.077 26 15.983 14.375 13.003 | 11.826 10.810 9.929 9.161 27 16.330 | 14.643 13.211 11.987 10.935 10.027 9.237 28 16.663 14.898 | 13.406 12.137 | 11.051 10.116 | 9.307 29 16.984|15.14113.591 | 12.278 11.158 10.1989.370 30 17.292 | 15.372 | 13.765 12.409 | 11.258 10.2749.427 40 19.793 17.159 15.046 13.332 11.925 10.7579.779 11% 0.901 1.713 2.444 3.102 3.696 4.231 4.712 5.146 5.537 5.889 6.207 6.492 6.750 6.982 7.191 7379 7.549 7.702 7.839 7.963 8.075 8.176 8.266 8.348 8.422 8.488 3.548 8.602 8.650 8,694 8.951 12% 13% 14% 0.893 0.885 0.877 1.690 1.668 1.647 2.402 2.361 2.322 3.037 2.974 2.914 3.605 3.517 3.433 4.111 3.998 3.889 4.564 4.423 4.288 4.968 4.799 4.639 5.328 5.132 4.946 5.650 5.426 5.216 5.938 5.687 5.453 6.194 5.918 5.660 6.424 6.122 5.842 6.628 6.302 6.002 6.811 6.462 6.142 6.974 6.604 6.265 7.120 6.729 6.373 7.250 6.840 6.467 7.366 6.938 6.550 7.469 7.025 6.623 7.562 7.1026.687 7.645 7.170 6.743 7.718 7.230 6.792 7.784 7.283 6.835 7.843 7.330 6.873 7.896 7.372 6.906 7.943 7.409 6.935 7.984 7.441 6.961 8.022 7.470 6.983 8.055 7.496 7.003 8.244 7.634 7,105 15% 16% 17% 0.870 0.862 0.855 1.626 1.605 1.585 2.283 2.246 2.210 2.855 2.798 2.743 3.352 3.274 | 3.199 3.784 3.685 3.589 4.160 4.039 3.922 4.487 4.344 4.207 4.772 4.607 4.451 5.019 4.833 4.659 5.234 5.029 4.836 5.421 5.197 4.988 5.583 5.342 5.118 5.724 5.468 5.229 5.847 5.575 5.324 5.954 5.668 5.405 6.047 5.749 5.475 6.128 5.818 5.534 6.198 5.877 5.584 6.259 5.929 5.628 6.312 5.973 5.665 6.359 6.011 5.696 6.399 6.044 5.723 6.434 6.073 5.746 6.464 6.097 5.766 6.491 6.118 5.783 6.514 6.136 5.798 6,534 6.152 5.810 6.551 6.166 5.820 6.566 6.177 5.829 6.642 6.233 5.871 18% 19% 0.847 0.840 1.566 1.547 2.174 2.140 2.690 2.639 3.127 3.058 3.498 3.410 3.812 3.706 4.078 3.954 4.303 4.163 4.494 4,339 4.656 4.486 4.611 4.910 4.715 5.008 4.802 5.092 4.876 5.162 4.938 5.222 4.990 5.273 5.033 5.316 5.070 5.353 5.101 5.384 5.127 5.410 5.149 5.432 5.167 5.451 5.182 5.467 5.195 5.480 5.206 5.492 5.215 5.502 5.223 5.510 5.229 5.517 5.235 5.548 5.258 20% 0.833 1.528 2.106 2.589 2.991 3.326 3.605 3.837 4.031 4.192 4.327 4.439 4.533 4.611 4.675 4.730 4.775 4.812 4.843 4.870 4.891 4.909 4.925 4.937 4.948 4.956 4964 4.970 4.975 4.979 4.997 0.826 1.509 2.074 2.540 2.926 3.245 3.508 3.726 3.905 4.054 4.177 4.278 4.362 4.432 4.489 4.536 4.576 4.608 4.635 4.657 4.675 4.690 4.703 4.713 4.721 4.728 4.734 4.739 4.743 4.746 4.760 22% 0.820 1.492 2.042 2.494 2.864 3.167 3.416 3.619 3.786 3.923 4.035 4.127 4.203 4.265 4.315 4.357 4.391 4.419 4.442 4.460 4.476 4.488 4.499 4.507 4.514 4.520 4.524 4.528 4.531 4.534 4.544 L 23% 0.813 1.474 2.011 2.448 2.803 3.092 3.327 3.518 3.673 3.799 3.902 3.985 4.053 4.108 4.153 4.189 4.219 4.243 4.263 4.279 4.292 4.302 4.311 4.318 4.323 4.328 4.332 4.335 4.337 4.339 4.347 24% 25% 0.806 0.800 1.457 1.440 1.981 1.952 2.404 2.362 2.745 2.689 3.020 2.951 3.242 3.161 3.421 3.329 3.566 3.463 3.682 3.571 3.776 3.656 3.851 3.725 3.912 3.780 3.962 3.824 4.001 3.859 4.033 3.887 4.059 3.910 4.080 3.928 4.097 3.942 4.110 3.954 4.121 3.963 4.130 3.970 4.137 3.976 4.143 3.981 4.147 3.985 4.151 3.988 4.154 3.990 4.157 3.992 4.159 3.994 4.1600 113.995 4.166 30999