! Required information [The following information applies to the questions displayed below) Nick's Novelties, Incorporated, is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $300,000, have an eight-year useful life, and have a total salvage value of $20,000. The company estimates that annual revenues and expenses associated with the games would be as follows: Revenues $ 200,000 Less operating expenses Commissions to amusement houses $ 100,000 7.000 Depreciation 160,000 Net operating income $ 40,000 Insurance Maintenance 35,000 18,000 Required: 1a. Compute the payback period associated with the new electronic games. 1b. Assume that Nick's Novelties, Incorporated, will not purchase new games unless they provide a payback period of five years or less. Would the company purchase the new games? Complete this question by entering your answers in the tabs below. Reg 1A Reg 18 Compute the payback period associated with the new electronic games. Payback period Years Reg 1 Reg 1B > Req IA Reg 1B Assume that Nick's Novelties, Incorporated, will not purchase new games unless they provide a payback period of five years or less. Would the company purchase the new games? Yes No