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Need help with number 4. Please show me the steps I am confused Balloons By Sunset (BBS) is considering the purchase of two new hot
Need help with number 4. Please show me the steps I am confused
Balloons By Sunset (BBS) is considering the purchase of two new hot air balloons so that it can expand its desert sunset tours. Various information about the proposed investment follows: Euture Value of S1, Present Value of \$1. Euture Volue Annulty of \$1. Present Value Annuity of \$1.) Note: Use appropriate factor(s) from the tables provided. Assume straight line depreciation method is used. Required: Help BBS evaluate this project by calculating each of the following: 1. Accounting rate of return. Note: Round your answer to 2 decimal places. 2. Payback period. Note: Round your answer to 2 decimal places. 3. Net present value (NPV). Note: Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar. 4. Recalculate the NPV assuming BBS's cost of capital is 13 percent. Note: Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar. 1. Accounting rate of return. Note: Round your answer to 2 decimal places. 2. Payback period. Note: Round your answer to 2 decimal places. 3. Net present value (NPV). Note: Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar. 4. Recalculate the NPV assuming BBS's cost of capital is 13 percent. Note: Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar. TABLE 11.1A Future Value of $1 TABLE 11.4A Present Value of Annuity of $1 TABLE 11.3A Future Value of an Annuity of $1 TABLE 11.2A Present Value of $1 Step by Step Solution
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