PR $17-1($LO $17-6)$ SlowRider Incorporated had a rudimentary business intelligence $($BI$)$ system. After interviewing managers at other firms that have already implemented similar BI systems, the project team then

estimated that the initiative would have the following risks.

R $17-1$ Part a: Disregarding the risk, calculate the payback period, NPV$,$ IRR, and accounting rate of

eturn $($annual$).$

equired:

$.$ Disregarding the risk, calculate the payback period, NPV$,$ IRR, and accounting rate of return $($annual$).$

$[$The following information applies to the questions displayed below.$]$

SlowRider Incorporated had a rudimentary business intelligence $($BI$)$ system. Analysts at SlowRider Incorporated pulled

data from three different ERP systems, loaded the data into Excel spreadsheets, and emailed those spreadsheets to the

senior managers each month. However, some managers complained that they didn't understand how to get the

information they needed, others complained that the data were not accurate, and still others ignored the spreadsheets.

SlowRider established a project team to look at acquiring a state$-$of$-$the$-$art business intelligence system. After several

interviews with all the managers, the project team was ready to develop the business case.

The project team estimated benefits of the new BI system as follows:

$5$ percent increase in sales through better$-$focused sales campaigns, which should increase gross margins by

$$200,000$ in year $1$ and $$300,000$ in years $2$ and $3.$

$10$ percent increase in inventory turnover through better purchasing, which should reduce inventory carrying costs by

$$100,000$ in year $1$ and $$150,000$ in years $2$ and $3.$

The project team estimated costs over an expected $3-$year life as follows:Required information

PR $17-1($LO $17-6)$ SlowRider Incorporated had a rudlmentary business Intelligence $($BI$)$ system.

$[$The following information applles to the questions dlsplayed below.$]$

SlowRider Incorporated had a rudimentary business intelligence $($Bl$)$ system. Analysts at SlowRider Incorporated pulled

data from three different ERP systems, loaded the data Into Excel spreadsheets, and emalled those spreadsheets to the

senlor managers each month. However, some managers complalned that they didn't understand how to get the

Information they needed, others complained that the data were not accurate, and stlll others ignored the spreadsheets.

SlowRider established a project team to look at acquiring a state$-$of$-$the$-$art business intelligence system. After several

Intervews with all the managers, the project team was ready to develop the business case.

The project team estimated benefits of the new BI system as follows:

$5$ percent Increase In sales through better$-$focused sales campalgns, which should increase gross margins by

$$200,000$ in year $1$ and $$300,000$ in years $2$ and $3.$

$10$ percent increase in inventory turnover through better purchasing, which should reduce inventory carrying costs by

$$100,000$ in year $1$ and $$150,000$ in years $2$ and $3.$

The project team estimated costs over an expected $3-$year life as follows:

After Interviewing managers at other firms that have already implemented similar BI systems, the project team then

estimated that the initlative would have the following risks.

PR $17-1$ Part a: Disregarding the rlsk$,$ calculate the payback perlod, NPV$,$ IRR, and accounting rate of

return $($annual$).$