Exercise 14-9 (Algo) Net Present Value Analysis and Simple Rate of Return [LO14-2, LO14-6] Derrick Iverson is a divisional manager for Holston Company. His annual pay raises are largely determined by his division's return on investment (ROI), which has been above 25% each of the last three years. Derrick is considering a capital budgeting project that would require a $5,170,000 Investment in equipment with a useful life of five years and no salvage value. Holston Company's discount rate is 19%. The project would provide net operating income each year for five years as follows: Sales Variable expenses Contribution margin $4,500,000 2,000,000 2.500,000 Fixed expenses: Advertising, salaries, and other fixed out-of- pocket costs Depreciation $780,000 1,034,000 Total fixed expenses 1,814,000 $ 686,000 Not operating income Click here to view Exhibit 148-1 and Exhibit 148-2, to determine the appropriate discount factor(s) using tables Required: 1. Compute the project's net present value. 2. Compute the project's simple rate of return. To Wa