..... p15-1 Average rate of return method, net present value method, and analysis Obj 2, 3 The capital investment committee of Overnight Express Inc. is considering two investment projects. The estimated income from operations and net cash flows from each investment are as follows: Distribution Center Expansion Internet Tracking Technology 1. a. 16.5% Income from Net Cash Net Cash Year Income from Operations Flows Operations Flows $ 66,000 $ 226,000 $200,000 $ 360,000 66,000 226,000 90,000 250,000 - W N - 66,000 226,000 30,000 190,000 4 66,000 226,000 10,000 170,000 5 66,000 226,000 160,000 Total $330,000 $1,130,000 $330,000 $1,130,000 ST Each project requires an investment of $800,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 15% for purposes of the net present value analysis. 280 080 Instructions 000 051. 1. Compute the following: $50:090 a. The average rate of return for each investment. b. The net present value for each investment. Use the present value of $1 table appearing in this chapter. go al suley 2. Prepare a brief report for the capital investment committee, advising it on the relative merits of the two projects. mojong doesnot gnuwollot siderunnion)