River Wild is considering purchasing a water park in Charleston, South Carolina, for $2,200,000. The new facility will generate annual net cash inflows of $495,000 for ten years. Engineers estimate that the facility will remain useful for ten years and have no residual value. The company uses straight-line depreciation. Its owners want payback in less than five years and an ARR of 12% or more. Management uses a 10% hurdle rate on investments of this nature (Click the icon to view the present value annuity table.) (Click the icon to view the future value annuity table.) Read the requirements (Click the icon to view the present value table.) (Click the icon to view the future value table) Requirement 1. Compute the payback period, the ARR, the NPV, and the approximate IRR of this investment. (If you use the tables to compute the IRR, answer with the closest interest rate shown in the tables.) (Round the payback period to one decimal place) The payback period (in years) is (Round the percentage to the nearest tenth percent.) in The ARR (accounting rate of return) is R Cu (Round your answer to the nearest whole dollar) Net present value The IRR (internal rate of return) is between Requirement 2. Recommend whether the company should invest in this project Recommendation Co Reference TRANG TR restoral value. The company uses straight-line depreciatic Present Value of Annulty of $1 1% 0.990 Periods 2% 3% 4% Period 1 0.980 0.971 0.962 Period 2 1.970 1.942 1.913 1.886 Period 3 2.941 2.884 2.829 2.775 Period 4 3.902 3.808 3.717 3.630 Period 5 4.853 4.713 4.580 4.452 5% 6% 8% 10% 12% 0.952 0.943 0.926 0.909 0.893 1.859 1.833 1.783 1.736 1.690 2.723 2.673 2.577 2.487 2.402 3.546 3.465 4.329 4.212 14% 16% 18% 20% 0.877 0.862 0.847 0.833 1.647 1.605 1.566 1.528 2.322 2.246 2.174 2.106 3.312 3.170 3.037 2.914 2.798 2.690 2.589 3.993 3.791 3.605 3.433 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 3.889 3.685 3.498 3.326 Period 7 6.728 6.472 6.230 6.002 5.786 5.582 5.206 4.868 4.564 4.288 4.039 3.812 3.605 Period 8 7.652 7.325 7.020 6.733 Period 9 8.566 8.162 7.786 7.435 Period 10 9.471 8.983 8.530 8.111 Period 11 10.368 9.787 9.253 8.760 Period 12 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6.194 Period 13 12.134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 6.424 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.367 6.628 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 6.811 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.469 Period 25 22.023 19.523 17.413 15.622 14.094 12.783 10.675 9.077 7.843 Period 30 25.808 22.396 19.600 17.292 15.372 13.765 11.258 9.427 8.055 Period 40 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 8.244 6.142 6.623 6.873 7.003 7.105 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 7.108 6.802 7.722 7.360 6.247 5.759 -5.328 4.946 4.607 4.303 4.031 6.710 6.145 5.650 5.216 4.833 4.494 4.192 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 5.660 5.197 4.793 4.439 5.842 5.342 4.910 4.533 6.002 5.468 5.008 4.611 5.575 5.092) 4.675 5.929 5.353 4.870 6.097 5.467 4.948 6.233 5.548 6.177 5.517 4.979 4.997 Print Done - X Reference Future Value of Annulty of $1 -X Periods 1% 2% 3% 4% 5% Period 1 1.000 1.000 1.000 1.000 1.000 at Period 2 2.010 2.020 2.030 2.040 2.050 nt Period 3 3.030 Period 4 3.060 3.091 4.060 4.122 4.184 Perlod 5 5.101 5.204 5.309 3.122 3.153 6% 1.000 1.000 1.000 2.060 2.080 3.184 3.246 5% 10% 2.100 3.310 3.374 12% 1.000 2.120 2.140 14% 16% 18% 20% 1.000 1.000 1.000 1.000 2.160 2.180 2.200 3.440 3.506 3.572 3.640 4.246 4.310 5.416 4.375 4.506 4.641 4.779 4.921 5.066 5.215 5.368 5.526 5.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 Period 6 6.152 6.308 6.468 6.633 6.802 Period 7 7.214 7.434 7.662 7.898 8.142 Period & 8.286 8.583 8.892 9.214 9.549 CC Period 9 9.369 a V Period 10 Period 11 Period 12 Period 13 Period 14 er Period 15 7.716 8.115 8.536 9.487 10.089 10.637 11.436 12.300 9.755 10.159 10.583 11.027 11.491 12.488 13.579 14.776 10.462 10.950 11.464 12.006 12.578 13.181 14.487 15.937 17.549 11.567 12.169 12.808 13.486 14.207 14.972 16.645 18.531 20.655 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.354 24.133 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 28.029 14.947 15.974 17.086 18.292 19.599 21.015 24.215 27.975 32.393 16.097 17.293 18.599 20.024 21.579 23.276 27.152 31.772 37.280 8.394 6.975 7.336 8.923 8.977 9.442 9.930 10.730 11.414 12.142 12.916 9.897 13.233 14.240 15.327 16.499 16.085 19.337 17.519 19.056 20.799 21.321 23.521 25.959 23.045 25.733 28.755 32.150 27.271 30.850 34.931 39.551 32.089 36.786 42.219 48.497 37.581 43.672 50.818 59.196 43.842 51.660 60.965 72.035 nt Period 20 Period 25 dat Period 30 Period 40 115.380 146.628 186.688) 22.019 24.297 26.870 29.778 33.066 36.786 45.762 57.275 72.052 249.214 342.603 471.981 28.243 32.030 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 34.785 40.568 47.575 56.085 66.439 79.058 113.283 164.494 241.333 356.787 530.312 790.948 1,151.882) 48.886 60.402 75.401 95.026 120.800 154.762 259.057 442.593 767.091 1,342.025 2.360.757 4,163.213 7,343.858 91.025 Print Done Reference Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.857 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.909 0.893 0.877 0.862 0.847 0.826 0.797 0.769 0.743 0.718 0.794 0.751 0.712 0.675 0.641 0.609 0.579 0.735 0.683 0.636 0.592 0.552 0.516 0.482 0.681 0.621 0.567 0.519 0.476 0.437 0.402 0.833 0.694 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 Period 7 0.933 0.871 0.813 0.760 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 Period 9 0.914 0.837 0.766 0.703 0.630 0.564 0.507 0.456 0.410 0.370 0.335 0.711 0.665 0.583 0.513 0.452 0.400 0.354 0.314 0.279 0.540 0.467 0.404 0.351 0.305 0.266 0.233 0.645 0.592 0.500 0.424 0.361 0.308 0.263 0.225 0.194 Period 10 0.905 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.191 0.162 Period 11 0.896 0.804 0.722 0.650 0.585 0.527 0.429 0.350 0.287 0.237 0.195 0.162 0.135 Period 12 0.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.168 0.137 0.112 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.368 0.290 0.229 0.182 0.145 0.116 0.093 Period 14 0.870 0.758 Period 15 0.861 0.743 0.642 0.661 0.577 0.505 0.442 0.555 0.481 0.417 0.340 0.263 0.205 0.160 0.125 0.099 0.078 0.315 0.239 0.183 0.140 0.108 0.084 0.065 Period 20 0.820 0.673 0.554 0.456 0.377 0.104 Period 25 0.780 0.610 0.478 0.375 0.295 Period 30 0.742 0.552 0.412 0.308 0.231 Period 40 0.672 0.453 0.307 0.208 0.142 0.312 0.215 0.149 0.233 0.146 0.092 0.059 0.038 0.024 0.016 0.010 0.174 0.099 0.057 0.033 0.020 0.012 0.007 0.004 0.097 0.046 0.022 0.011 0.073 0.051 0.037 0.026 0.005 0.003 0.001 0.001 Reference Future Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 1.010 1.020 1.030 1.040 1.050 1.060 1.080 Period 2 1.020 1.040 1.061 1.082 1.103 1.124 Period 3 1.030 1.061 1.093 1.125 1.158 1.191 1.260 1.331 Period 4 1.041 1.082 1.126 1.170 1.216 1.262 1.360 1.464 1.574 Period 5 1.051 1.104 1.159 1.217 1.276 1.338 1.469 1.611 1.762 1.925 1.100 1.120 1.140 1.160 1.166 1.210 1.254 1.300 1.346 1.405 1.482 1.561 1.643 1.728 1.689 1.811 1.939 2.074 2.288 2.100 2.488 1.180 1.200 1.392 1.440 Period 6 1.062 1.126 1.194 1.265 1.340 1.419 1.587 1.772 1.974 2.195 2.436 2.700 2.986 Period 7 1.072 1.149 1.230 1.316 1.407 1.504 1.714 1.949 2.211 2.502 2.826 3.185 3.583 Period 8 1.083 1.172 1.267 1.369 1.477 1.594 1.851 2.144 2.476 2.853 3.278 3.759 4.300 Period 9 1.094 1.195 1.305 1.423 1.551 1.689 1.999 2.358 2.773 3.252 3.803 4.435 5.160 Period 10 1.105 1.219 1.344 1.480 1.629 1.791 2.159 2.594 3.106 3.707 4.411 5.234 6.192 Period 11 1.116 1.243 1.384 1.539 1.710 1.898 2.332 2.853 3.479 4.226 5.117 6.176 7.430 Period 12 1.127 1.268 1.426 1.601 2.012 1.796 2.518 3.138 3.896 4.818 5.936 7.288 8.916 Period 13 1.138 1.294 1.469 1.665 1.886 2.133 2.720 3.452 4.363 5.492 6.886 8.599 10.699 Period 14 1.149 1.319 1.513 1.732 1.980 2.261 2.937 3.797 Period 15 1.161 1.346 1.558 1.801 2.079 2.397 3.172 4.177 7.988 10.147 4.887 6.261 5.474 7.138 9.266 11.974 12.839 15.407 Period 20 1.220 Period 25 1.282 1.641 Period 30 1.348 1.811 Period 40 1.489 2.208 3.262 4.661 6.727 13.743 19.461 27.393 3.207 9.646 2.191 2.653 1.806 1.486 95.396 3.386 4.292 6.848 10.835 17.000 26.462 40.874 62.669 2.094 2.666 3.243 4.322 5.743 10.063 17.449 29.960 50.950 85.850 143.371 237.376 2.427 4.801 7.040 10.286 21.725 45.259 93.051 188.884 378.721 750.378 1,469.772 38.338 -X between ether the c 16% and 18% 20% and 22% 22% and 24% 18% and 20% his project equirement 2. Recommend whether the company should invest in this project. Recommendation: Do not invest in the new facility. Invest in the new facility