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Family Day Out Fun Center is evaluating the purchase of a new game to be located on its Midway. The company has narrowed their
Family Day Out Fun Center is evaluating the purchase of a new game to be located on its Midway. The company has narrowed their choices down to two: the Wacky Water Race game and the Whack-A-Mole game. Financial data about the two choices follows Investment Useful life Estimated annual net cash inflows for 8 years Residual value Depreciation method Required rate of retum Wacky Water Race Whack-A- Mole $29,000.00 $16,000.00 8 $5,000.00 $8,000.00 $3,000.00 $3,000.00 straight-line straight-line 4% 10% What is the net present value of the Whack-A-Mole game? Present Value of $1 Penods 4% 6% 8% 10% 12% 1 0962 0.043 0.920 0.909 0.893 2 0925 0890 0.857 0.825 0.707 0.809 0840 0.794 0.751 0.712 4 0.855 0.792 0.735 0.003 0636 5 0822 0.747 0.681 0.621 0.567 6 0.790 0.705 0.630 0.564 0.507 0.760 0.665 0583 0.513 0.452 8 0.731 0627 0.540 0407 0.404 Present Value of Annuity of $1 Periods 4% 6% 0% 10% 12% 1 0.962 0.943 0.926 0.909 0803 2 1.856 1.833 1.783 1.736 1.000 2.775 2.673 2.577 2487 2.402 3.630 3465 3.312 0.170 3.037 4452 4.212 3.993 3.791 3.605 A. ($4,665.00) OB. ($28,081.00) OC. $4,665.00 OD. $28,081.00
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