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Show all work Balloons By Sunset (BBS) is considering the purchase of two new hot air balloons so that it can expand its desert sunset
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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: (Future Value of \\( \\$ 1 \\), Present Value of \\( \\$ 1 \\), Future Value Annuity 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 11 percent. Note: Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollarStep by Step Solution
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