11 Quiz: Quiz 12 - Chapter 12 < Question 2 of 2 Tidal Wave is considering purchasing a water park in San Antonio, Texas, for $2,200,000. The new facility will generate annual net cash inflows of S ten years and have no residual value. The company uses straight-line depreciation. Its owners want payback in less than five years and an ARR of (Click the icon to view the present value annuity table.) (Click the icon to view the present value table.) (Click the icon to view the future value annuity table.) Read the requirements (Click the icon to view the future value table.) CEED Requirement 1. Compute the payback period, the ARR, the NPV, and the approximate IRR of this investment. (If you use the tables to compute th payback period to one decimal place.) The payback period (in years) is (Round the percentage to the nearest tenth percent.) The ARR (accounting rate of return) is (Round your answer to the nearest whole dollar) Net present value The IRR (internal rate of return) is between %. dina anyei 06/01/22 8:00 PM Question 2 of 2 This quiz: 20 point(s) possible This question: 10 point(s) possible Submit quiz for $2,200,000. The new facility will generate annual net cash inflows of $515,000 for ten years. Engineers estimate that the facility will remain useful for eciation. Its owners want payback in less than five years and an ARR of 12% or more. Management uses a 10% hurdle rate on investments of this nature. ck the icon to view the present value table.) (Click the icon to view the future value table.) approximate IRR of this investment. (If you use the tables to compute the IRR, answer with the closest interest rate shown in the tables) (Round the Requirement 1. Compute the payback period, the ARR, the NPV, and the approximate IRR of this investment. (If you use the tables payback period to one decimal place.) The payback period (in years) is (Round the percentage to the nearest tenth percent.) The ARR (accounting rate of return) is (Round your answer to the nearest whole dollar.) Net present value The IRR (internal rate of return) is between %. Requirement 2. Recommend whether the company should invest in this project Recommendation ec 4800 Reference -X 0 er Present Value of Annulty of $1 e= Periods 1% 2% 3% 4% Period 1 0.990 0.980 0.971 0.962 Period 2 1.970 1.942 1.913 1.886 12% 10% 8% 6% 5% 0.952 0.943 0.926 0.909 0.893 1.859 14% 16% 18% 20% 0.877 0.862 0.847 0.833 Period 3 2.941 2.884 2.829 2.775 2.723 1.833 1.783 1.736 1.690 1.647 2.673 2.577 2.487 2.402 1.605 1.566 1.528 2.322 2.246 2.174 2.106 Period 4 3.902 4.853 5.795 6.728 Period 5 Period 6 Period 7 7.652 Period 8 8.566 Period 9 8.162 7.786 7.435 Period 10 9.471 8.983 8.530 8.111 Period 11 10.368 9.787 9.253 8.760 Period 12 11.255 10.575 9.954 9.385 Period 13 12.134 11.348 10.635 9.986 Period 14 13.004 12.106 11.296 10.563 9.899 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 3.808 3.717 4.713 4.580 4.452 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 4.329 4.212 3.993 3.791 3.605 3.433 3.274 3.127 2.991 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 3.889 3.685 3.498 3.326 6.472 6.230 6.002 5.716 5.582 5.206 4.868 4.564 4.288 4.039 3.812 3.605 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 7.108 6.802 6.247 5.759 5.328 7.722 7.360 6.710 6.145 5.650 4.946 4.607 4.303 4.031 5.216 4.833 4.494 4.192 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 8.863 8.384 7.536 6.814 6.194 5.660 5.197 4,793 4.439 9.394 8.853 7.904 7.103 6.424 5.842 5.342 4.910 4.533 9.295 8.244 7.367 6.628 6.002 5.468 5.008 4.611 8.559 7.606 6.811 6.142 5.575 5.092 4.675 Reference Future Value of Annulty of $1 Periods 1% 2% 3% 4% 5% 8% Period 1 1.000 1.000 1.000 1.000 Period 2 2.010 2.020 2.030 2.040 2.050 Period 3 3.030 3.060 3.091 3.122 3.153 Period 4 4.060 4.122 4.184 4.246 4.310 Period 5 5.101 5.204 5.309 5.416 6% 1.000 1.000 1.000 2.060 2.080 2.100 3.184 3.246 3.310 3.374 4.375 4.506 4.641 4.779 5.526 5.637 5.867 6.105 6.353 6.610 10% 12% 14% 16% 18% 20% 1.000 1.000 1,000 1.000 1.000 1.000 2.120 2.140 2.160 2.180 2.200 3.440 3.506 3.572 3.640 4.921 5.066 5.215 5.368 6.877 7.154 1.442 Period 6 6.152 Period 7 6.308 6.468 6.633 6.802 6.975 7.336 7.716 8.115 7.214 7.434 7.662 7.898 8.142 8.394 8.923 9.487 10.089 Period 8 8.286 8.583 8.892 9.214 9.549 9.897 10.637 11.436 12.300 Period 9 9.369 9.755 10.159 10.583 11.027 11.491 12.488 13,579 Period 10 10.462 10.950 11.464 12.006 12.578 8.536 8.977 9.442 9.930 13.181 14.776 14.487 15.937 17.549 10.730 11.414 12.142 13.233 14.240 16.085 12.916 15.327 16.499 17.519 19.086 20.799 19.337 21.321 23.521 25.959 Period 11 11.567 Period 12 12.169 12.808 13.486 14.207 12.683 13.412 14.192 15.026 15.917 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 Period 13 Period 14 Period 15 16.870 18.977 21.384 24,133 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 28.029 14.947 15.974 17.086 18.292 19.599 21.015 24.215 27.975 32.393 16.097 17.293 18.599 20.024 21,579 23.276 27.152 31.772 37.280 27.271 30.850 34.931 39.581 32.089 36.786 42.219 48.497 37.581 43.672 50.818 59.196 43.842 51.660 60.965 72.035 Print Done Rem Reference Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 Period 3 0.971 0.942 0.915 0.889 0.864 Period 4 0.961 0.924 0.888 0.855 0.823 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.857 0.826 0.840 0.794 0.751 0.792 0.735 0.683 0.621 14% 0.893 0.877 0.862 0.847 0.833 0.718 0.694 0.797 0.769 0.743 0.712 0.675 0.641 0.609 0.636 0.592 0.552 0.516 0.482 0.402 0.567 0.519 0.476 0.437 16% 18% 20% 0.579 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.630 0.564 0.507 0.456 0.410 0.370 0.335 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.583 0.513 0.452 0400 0.354 0.314 0.279 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.404 0.351 0.305 0.266 0.233 Period 9 0.914 0.837 0.766 0.703 0.645 0.592 0.500 0.424 0.361 0.308 0.263 0.225 0.194 Period 10 0.905 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.191 0.162 Period 11 0.896 0.804 0.722 0.650 Period 12 0.887 0.788 0.701 0.625 0.557 Period 13 0.879 0.773 0.681 Period 14 0.870 0.758 0.661 Period 15 0.861 0.743 0.642 0.527 0.497 0.601 0.530 0.469 0.577 0.505 0.442 0.555 0.4811 0.585 0.429 0.350 0.287 0.397 0.319 0.257 0.290 0.229 0.182 0.145 0.116 0.093 0.368 0.205 0.160 0.125 0.099 0.078 0.340 0.263 0.417 0.315 0.239 0.183 0.140 0.108 0.084 0.065 0.237 0.208 0.168 0.137 0.112 0.195 0.162 0.135 Print Done - X Sec 4800 2 ater pa e comp alue an Reference Future Value of $1 Periods 1% 2% 3% 4% 5% ue ann Period 1 1.010 1.020 1.030 1.040 Period 2 1.020 1.040 1.061 1.082 Period 3 1.030 1.061 1.093 1.125 1.158 6% 1.050 1.060 1.103 1.124 1.191 Period 4 1.041 1.082 1.126 1.170 1.216 1.262 Period 5 1.051 1.104 1.159 1.217 1.276 1.338 1.469 8% 10% 12% 14% 16% 1.080 1.100 1.120 1.140 1.160 1.180 1.166 1.210 1.254 1.300 1.346 1.392 1.260 1.331- 1.405 1.482 1.561 1.643 1.360 1.464 1.574 1.689 1.811 1.939 1.611 18% 20% 1.200 1.440 1.728 2.074 1.762 1.925 2.100 2.288 2.488 Period 6 1.062 1.126 1.194 1.265 1.340 1.419 1.587 1.772 1.974 2.195 2.436 2.700 2.986 period, th Period 7 1.072 1.149 1.230 1.316 1.407 1.504 1.714 1.949 2.211 2.502 2.826 3.185 3.583 Period 8 1.083 1.172 1.267 1,369 1477 1.594 1,851 2.144 2.476 2.853 3.278 3.759 4.300 Period 9 1.094 1.195 1.305 1.423 1.551 1.689 1.999 2.358 2.773 3.252 3.803 4.435 5.160 Period 10 1.105 1.219 1.344 1.480 1.629 1.791 2.159 2.594 3.106 3.707 4.411) 5.234 6.192 Period 11 1.116 1.243 1.384 1.539 1.710 1.898 2.332 2.853 3,479 4.226 5.117 6.176 7.430 enth perce Period 12 1.127 1.268 1.426 1.601 1.796 2.012 2.518 3.138 3.896 5.936 4.818 7.288 8.916 Period 13 1.138 1.294 1.469 1.886 1.665 2.133 2.720 Period 14 1.149 1.319 1.513 1.980 1.732 Period 15 1.161 1.346 1.558 1.801 2.261 2.079 2.397 3.452 4.363 5.492 6.856 3.797 2.937 4.887 6.261 7.988 7.138 5.474 9.266 3.172 4.177 8.599 10.699 10.147 12.839 11.974 15.407 ole dollar) ] tween Print Done - X he F