Blue Water World is considering purchasing a water park in Columbus, Ohio, for $2,050,000. The new facility will generate annual net cash inflows of $515,000 for eight years. Engineers estimate that the facility will remain useful for eight 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 12% or more. Management uses a 14% hurdle rate on investments of this nature. (Click the icon to view the present value annuity table.) (Click the icon lo view the present value table.) (Click the icon to view the future value annuity table.) (Click the icon to view the future value table.) Read the requirements. Requirement 1. Compute the payback period, the ARR, the NPV, and the 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 payback period to one decimal place.) The payback period is years i Reference ws prec Periods 1 2 3 12% 0.893 1.690 2.402 3.037 3.605 14% 0.877 1.647 2.322 2.914 3.433 16% 0.862 1.605 2.246 2.798 3.274 18% 0.847 1.566 2.174 2.690 3.127 20% 0.833 1.528 2.106 2.589 2.991 the 5 6 7 8 9 10 Present Value of Annuity of $1 1% 2% 3% 4% 5% 6% 8% 10% 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 1,970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 4.853 4.713 4.580 4.452 4.329 4.212 3.993 3.791 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 6.728 6.472 6.230 6.002 5.786 5.582 5.206 4.868 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 8.566 8.162 7.786 7.435 7.108 6.802 6.247 5.759 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 10.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 12.134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.367 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 22.023 19.5231741315.622 14.094 12.783 10.675 9.077 25.808 22.39619.600 17.292 15.372 13.765 11.258 9.427 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 4.111 4.564 4.968 5.328 5.650 3.889 4.288 4.639 4.946 5.216 3.685 4.039 4,344 4.607 4.833 3.498 3.812 4.078 4.303 4.494 3.326 3.605 3.837 4.031 4.192 4.327 4.439 4.533 4.611 4.675 11 12 13 14 15 5.938 6.194 6.424 6.628 6.811 5.453 5.660 5.842 6.002 6.142 5.029 5.197 5.342 5.468 5.575 4.656 4.793 4.910 5.008 5.092 20 25 30 40 7.469 7.843 8.055 8.244 6.623 6.873 7.003 7.105 5.929 6.097 6.177 6.233 5.353 5.467 5.517 5.548 4.870 4.948 4.979 4.997 Print Done Clear All Check Ans 7A (book/static) Question Help Reference Periods 2% 1 1.000 2 3 4 5 1% 1.000 2010 3.030 4.060 5.101 3% 1.000 2.030 3.091 4.184 5,309 4% 1.000 2.040 3.122 4.246 5.416 12% 1.000 2.120 3.374 4.779 6.353 6 7 8 6.152 7214 8.286 9.369 10.462 8.115 10.089 12.300 14.776 17.549 9 10 2020 3.060 4122 5.204 6.308 7434 8.583 9.755 10.950 12.169 13.412 14.680 15.974 17.293 24 297 32.030 40.568 60.402 Future Value of Annuity of $1 5% 6% 8% 10% 1.000 1.000 1.000 1.000 2.050 2.060 2.080 2.100 3.153 3.184 3.246 3.310 4.310 4.375 4.506 4641 5.526 5,637 5.867 6.105 6.802 6.975 7.336 7.716 8.142 8.394 8.923 9.487 9.549 9.897 10.637 11436 11.027 11491 12.488 13.579 12.578 13.181 14.487 15.937 14.207 14.972 16.645 18.531 15.917 16.870 18.977 21.384 17.713 18.882 21.495 24.523 19.599 21.015 24.215 27.975 21.579 23.276 27.152 31.772 33.066 36.786 45.762 57 275 47.727 54.865 73.106 98.347 66.439 79,058 113.283 164494 120.800 154.762 259.057 442.593 6.468 7.662 8.892 10.159 11.464 12 808 14.192 15.618 17.086 18.599 26.870 38.459 47.575 75.401 11 12 13 14 15 14% 16% 18% 20% 1.000 1.000 1.000 1.000 2.140 2.160 2.180 2.200 3.440 3.506 3.572 3.640 4.921 5.066 5.215 5.368 6.610 6.877 7.154 7.442 8.536 8.977 9.442 9.930 10.730 11.414 12.142 12916 13233 14.240 15.327 16.499 16.085 17.519 19.086 20.799 19.337 21.321 23.521 25.959 23.045 25.733 28.755 32.150 27.271 30.850 34.931 39.581 32.089 36.786 42219 48.497 37.581 43.672 50.818 59.196 43.842 51.660 60.965 72.035 91.025 115.380 146.628 186.688 181.871 249.214 342.603 471.981 356.787 530.312 790.948 1,181.882 1,342.0252,360.7574,163.2137.343.858 6.633 7.898 9214 10.583 12.006 13.486 15.028 16.627 18.292 20.024 29.778 41.646 56.085 95.026 11.567 12,683 13.809 14.947 16.097 22.019 28.243 34.785 48.886 20.656 24.133 28.029 32.393 37.280 72.052 133.334 241.333 767.091 20 25 30 40 Print Done alnina 0 Reference Periods 1 1% 0.990 0.980 0.971 0.961 0.951 2% 0.980 0.961 0.942 0.924 0.906 3% 0.971 0.943 0.915 0.888 0.863 4% 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 0.676 Present Value of $1 5% 6% 8% 10% 0.952 0.943 0.926 0.909 0.907 0.890 0.857 0.826 0.864 0.840 0.794 0.751 0.823 0.792 0.735 0.683 0.784 0.747 0.681 0.621 0.746 0.705 0.630 0.564 0.711 0.665 0.583 0.513 0.677 0.627 0.540 0.467 0.645 0.592 0.500 0.424 0.614 0.558 0.463 0.386 12% 0.893 0.797 0.712 0.636 0.567 3 4 5 18% 0.847 0.718 0.609 0.516 0.437 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279 0.233 0.194 0.162 6 7 8 0.942 0.933 0.923 0.914 0.905 0.888 0.871 0.853 0.837 0.820 0.837 0.813 0.789 0.766 0.744 0.507 0.452 0.404 0.361 0.322 14% 16% 0.877 0.862 0.769 0.743 0.675 0.641 0.592 0.552 0.519 0.476 0.456 0.410 0.400 0.354 0.351 0.305 0.308 0.263 0.270 0.227 0.237 0.195 0.208 0.168 0.182 0.145 0.160 0.125 0.140 0.108 0.073 0.051 0.038 0.024 0.020 0.012 0.005 0.003 0.370 0.314 0.266 0.225 0.191 9 10 11 12 13 14 15 0.896 0.887 0.879 0.870 0.861 0.804 0.788 0.773 0.758 0.743 0.722 0.701 0.681 0.661 0.642 0.650 0.625 0.601 0.577 0.555 0.585 0.557 0.530 0.505 0.481 0.527 0.497 0.469 0.442 0.417 0.429 0.397 0.368 0.340 0.315 0.350 0.319 0.290 0.263 0.239 0.287 0.257 0.229 0.205 0.183 0.162 0.137 0.116 0.099 0.084 0.135 0.112 0.093 0.078 0.065 20 25 30 40 0.820 0.780 0.742 0.672 0.673 0.610 0.552 0.453 0.554 0.478 0.412 0.307 0.456 0.375 0.308 0.208 0.377 0.295 0.231 0.142 0.312 0.233 0.174 0.097 0.215 0.146 0.099 0.046 0.149 0.092 0.057 0.022 0.104 0.059 0.033 0.011 0.037 0.016 0.007 0.001 0.026 0.010 0.004 0.001 Print Done Reference Periods 1 2 3 4 5 3% 1.030 1.061 1.093 18% 1.180 1.392 1.643 1.939 2288 1.126 2% 1.020 1.040 1.061 1.082 1.104 1.126 1.149 1.172 1.195 1.219 1.159 6 7 1% 1.010 1.020 1.030 1.041 1.051 1.062 1.072 1.083 1,094 1.105 1.116 1.127 1.138 1.149 1.161 1.220 1.282 1.348 1.489 9 10 1.194 1.230 1.267 1.305 1.344 1.384 1426 1.469 1.513 1.558 4% 1.040 1.082 1.125 1.170 1.217 1.265 1.316 1.369 1.423 1.480 1.539 1.601 1.685 1.732 1.801 2.191 2868 3.243 4.801 5% 1.050 1.103 1.158 1.216 1.276 1.340 1.407 1477 1.551 1.629 1.710 1.796 1.886 1.980 2079 2653 3.385 4.322 7040 Future Value of $1 6% 8% 1.060 1.080 1.124 1.166 1.191 1.260 1.262 1.350 1.338 1.469 1419 1.587 1.504 1.714 1.594 1.851 1.689 1.999 1.791 2.159 1.898 2332 2012 2.518 2.133 2.720 2.261 2.937 2.397 3.172 3.207 4.661 4.292 6.848 5.743 10.063 10.286 21.725 10% 1.100 1210 1.331 1.464 1.611 1.772 1.949 2.144 2.358 2.594 2853 3.138 3.452 3.797 4.177 6.727 10.835 17 449 45.259 12% 1.120 1.254 1.405 1.574 1.762 1.974 2.211 2476 2.773 3.106 3.479 3.896 4363 4.687 5.474 9.646 17.000 29.960 93.051 14% 1.140 1.300 1.482 1.689 1.925 2.196 2.502 2.853 3.252 3.707 4.226 4.818 5.492 6.261 7.138 13.743 26.462 50.950 188,884 16% 1.160 1.346 1.561 1.811 2.100 2436 2826 3.278 3.803 4.411 5.117 5.936 6.886 7.988 9.266 20% 1.200 1440 1.728 2.074 2488 2.986 3.583 4.300 5.160 6.192 7430 8.916 10.699 12.839 15.407 38 338 95.396 237.376 1,469.772 11 12 13 14 15 2.700 3.185 3.759 4.435 5.234 6.176 7.288 8.599 10.147 11.974 27.393 62.669 143.371 750.378 1.243 1.268 1294 1.319 1.346 20 25 30 40 1.486 1.641 1.811 2208 1.806 2094 2427 3.262 19461 40.874 85 850 378.721 Print Done remaining