Exercise 13-8 Payback Period and Simple Rate of Return (LO13-1, L013-6) [The following information applies to the questions displayed below. Nick's Novelties, Inc., is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $365,000, have a fifteen-year useful life, and have a total salvage value of $36,500. The company estimates that annual revenues and expenses associated with the games would be as follows: $250,000 Revenues Less operating expenses: Commissions to amusement houses Insurance Depreciation Maintenance Net operating income $80,000 67,000 21,900 30,000 198,900 $ 51,100