I am having issues with required 3 and 4. I am not sure what I am doing wrong.

Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five-year period. His annual pay raises are determined by his divisions return on investment (ROI), which has exceeded 24% each of the last three years. He has computed the cost and revenue estimates for each product as follows:

	Product A			Product B
Initial investment:
Cost of equipment (zero salvage value)	$	330,000		$	515,000
Annual revenues and costs:
Sales revenues	$	370,000		$	470,000
Variable expenses	$	168,000		$	218,000
Depreciation expense	$	66,000		$	103,000
Fixed out-of-pocket operating costs	$	82,000		$	68,000

The companys discount rate is 15%.

Required:

1. Calculate the payback period for each product.

	Product A		Product B
Payback period	2.75 answer correct	years	2.80 answer correct	years

2. Calculate the net present value for each product.

Product A	Product B
Net present value	$72,360 answer correct	$101,952 answer correct

3. Calculate the internal rate of return for each product.

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4. Calculate the project profitability index for each product.

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5. Calculate the simple rate of return for each product.

	Product A		Product B
Simple rate of return	16.4 answer correct	%	15.7 answer correct	%