Lon Timur is an accounting major at a midwestern state university located approxmately ou miles from a major city. Many of the students attending the university are from the metropolitan area and visit their homes regularly on the weekends. Lon, an entrepreneur at heart, realizes that few good commuting altematives are available for students doing weekend travel. He believes that a weekend commuting service could be onganized and run profitably from several suburban and downtown shopping mall locations: Lonhas gathered the following investment information. 1. Five used vans would cost a total of $76,136 to purchase and would have a 3 -year useful life with negligible salvage value: Lon plans to use straight-line depreciation. 2. Tendrivers would have to be employed at a total payroll expense of $47,400. 3. Other annual out-of-pocket expenses associated with running the commuter service would include Gasoline $15.800. Maintenance $3,200, Repairs $3,700, Insurance $4,400, and Advertising$2,800. 4. Lon has visited several financial institutions to discuss funding. The best interest rate he has been able to negotiate is 15% Use this rate for cost of capital. 5. Lon expects each van to make ten round trips weekly and carry an average of six students each trip. The service is expected to operate 30 weeks eachyear, and eachstudent will be charged $12 for a round-trip ticket. 5. Lon wepects each van to mole ten round trips weeloy and carry an average of six students each trip. The service is expected to operate 30 weeks each year, and each sfudent will be charged $12 for a round-trio ticket. Qickheretoview the factor table [2] Determine the annual (2) net income and (2) net annaal cash flows for the comenuter service (round answers to O decimal ploces es: 125.1 (b) Compute the net present value of the commiter service thound mower to 0 dectmol nlarez, es 125. If the net present velue is regative. use either a negotive slan preceding the number 6345 or parenthese 9 ( 45 . For calculation purposes use 5 decimai pioca as diulojed lin the factor bable provided) Net present value