Collins Fun Center contains a number of electronic games as well as a miniature golf course and various rides located outside the building. Roberto Collins, the owner, would like to construct a water slide on one portion of his property. Mr. Collins has gathered the following information about the slide a. Water slide equipment could be purchased and installed at a cost of $330,000 According to the manufacturer, the slide would be usable for 12 years after which it would have no salvage value b. Mr. Collins would use straight-line depreciation on the slide equipment. c. To make room for the water slide, several rides would be dismantled and sold These rides are fully depreciated, but they could be sold now for $60,000 to an amusement park in a nearby city d. Mr. Collins has concluded that about 45,000 more people would use the water slide each year than have been using the rides. The admission price would be $3.75 per person (the same price that the Fun Center has been charging for the old rides). Although it is probable that 45,000 more people would use the water slide each year, Mr. Collins wonders how important it is to reach that level of volume and is curious about the project if only 40,000 more people would use the water slide each year e. Based on experience at other water slides, Mr. Collins estimates that annual incremental operating expenses for the slide would be: salaries, $85,000; insurance, $4,200; utilities, $13,000; and maintenance, $9,800. Ignore income taxes Mr. Collins requires a return on investment of 14% on all projects. Your analysis should use a 16% discount rate on cash flows. Mr. Collins also prefers projects with a payback period of 5 years or less f. Required: Analyze the information and make a recommendation to Mr. Collins about purchasing/installing a water slide. Your analysis must include An income statement showing the expected net operating income each year from the water slide Identification of the capital budgeting tools being used in your analysis with computations so that I can see what work you are doing to reach your conclusion A paragraph that identifies your recommendation with supporting evidence that summarizes the analysis you did to reach your recommendation