Splash Country is considering purchasing a water park in Atlanta, Georgia, for $1,850,000. The new facility will generate annual net cash inflows of $481,000 for eight years. Engineers estimate that the facility will remain useful for eight years and have no residual value. The company uses straight-line depreciation, and its stockholders demand an annual return of 12% on investments of this nature. (Click the icon to view the Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) (Click the icon to view Future Value of $1 table.) Read the requirements. (Click the icon to view Future Value of Ordinary Annuity of $1 table.) Requirement 1. Compute the payback, the ARR, the NPV, the IRR, and the profitability index of this investment. First, determine the formula and calculate payback. (Round your answer to one decimal place, X.X.) = Payback years Present Value of $1 Periods 1% 2% 3% 4% 5% Period 1 0.990 0.980 0.971 0.962 0.952 6% 7% 0.943 0.935 8% 0.926 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.873 0.857 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 0.794 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 0.735 0.708 0.683 9% 10% 12% 14% 15% 16% 18% 20% 0.917 0.909 0.893 0.877 0.870 0.862 0.847 0.833 0.842 0.826 0.797 0.769 0.756 0.743 0.718 0.694 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 0.636 0.592 0.572 0.552 0.516 0.482 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.567 0.519 0.497 0.476 0.437 0.402 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.666 0.623 Period 8 0.923 0.853 0.789 0.731 0.677 Period 9 0.914 0.837 0.766 0.703 0.645 Period 10 0.905 0.820 0.744 0.676 0.614 Period 11 0.896 0.804 0.722 0.650 0.585 0.527 Period 12 0.887 0.788 0.701 0.625 0.557 Period 13 0.879 0.773 0.681 0.601 Period 14 0.870 0.758 0.661 0.497 0.475 0.444 0.530 0.469 0.415 0.577 0.505 0.442 0.388 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.362 0.368 0.326 0.290 0.229 0.340 0.299 0.263 0.205 0.315 0.275 0.239 0.183 0.630 0.596 0.564 0.507 0.456 0.432 0.410 0.370 0.335 0.583 0.547 0.513 0.452 0.400 0.376 0.354 0.314 0.279 0.627 0.582 0.540 0.502 0.467 0.404 0.351 0.327 0.305 0.266 0.233 0.592 0.544 0.500 0.460 0.424 0.361 0.308 0.284 0.263 0.225 0.194 0.558 0.508 0.463 0.422 0.386 0.322 0.270 0.247 0.227 0.191 0.162 0.429 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 0.397 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.112 0.182 0.163 0.145 0.116 0.093 0.160 0.140 0.141 0.125 0.099 0.078 0.123 0.108 0.084 0.065 Period 16 0.853 0.728 0.623 0.534 0.458 0.394 0.339 0.292 Period 17 0.844 0.714 0.605 0.513 Period 18 0.836 0.700 0.587 0.494 0.416 0.350 Period 19 0.828 0.686 0.570 0.475 0.396 Period 20 Period 21 0.436 0.371 0.317 0.270 0.296 0.250 0.331 0.277 0.232 0.820 0.673 0.554 0.456 0.377 0.312 0.258 0.215 0.252 0.218 0.163 0.123 0.107 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.212 0.180 0.130 0.095 0.081 0.069 0.051 0.038 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 0.178 0.149 0.104 0.073 0.061 0.051 0.037 0.026 0.093 0.071 0.054 0.811 0.660 0.538 0.439 0.359 0.294 0.242 Period 22 0.803 0.647 0.522 0.422 0.342 0.278 Period 23 0.795 0.634 0.507 0.406 0.326 0.262 Period 24 0.788 0.622 0.492 0.390 Period 25 10 780 0610 0478 0375 0.226 0.199 0.184 0.211 0.170 0.310 0.247 0.197 0.158 0 295 0233 0 184 0146 0.164 0.135 0.093 0.150 0.123 0.083 0.138 0.112 0.074 0.126 0.102 0.066 0 116 0.092 0.059 0.064 0.053 0.044 0.031 0.022 0.056 0.046 0.038 0.026 0.018 0.049 0.040 0.033 0.022 0.015 0.043 0.035 0.028 0.019 0.013 0.038 0.030 0.024 0.016 0.010 Present Value of Ordinary Annuity of $1 Periods 1% 2% 3% 4% 0.990 0.980 0.971 5.242 5.076 4.917 4.767 6.002 5.786 5.582 5.389 6.733 6.463 6.210 5.971 7.435 7.108 6.802 6.515 8.111 7.722 7.360 7.024 8.760 8.306 7.887 7.499 9.385 8.863 8.384 7.943 9.986 9.394 8.853 8.358 10.563 9.899 9.295 8.745 13.865 12.849 11.938 11.118 10.380 9.712 9.108 5% 6% 7% 8% 9% 10% 12% 14% 15% Period 1 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0.870 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.626 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.402 2.322 2.283 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.914 2.855 2.798 Period 5 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.352 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 4.623 4.486 4.355 4.111 3.889 3.784 3.685 3.498 3.326 Period 7 6.728 6.472 6.230 5.206 5.033 4.868 4.564 4.288 4.160 4.039 3.812 3.605 Period 8 7.652 7.325 7.020 5.747 5.535 5.335 4.968 4.639 4.487 4.344 4.078 3.837 Period 9 8.566 8.162 7.786 6.247 5.995 5.759 5.328 4.946 4.772 4.607 4.303 4.031 Period 10 9.471 8.983 8.530 6.710 6.418 6.145 5.650 5.216 5.019 Period 11 10.368 9.787 9.253 7.139 6.805 6.495 5.938 5.453 5.234 Period 12 11.255 10.575 9.954 7.536 7.161 6.814 6.194 5.660 5.421 Period 13 12.134 11.348 10.635 7.904 7.487 7.103 6.424 5.842 5.583 Period 14 13.004 12.106 11.296 7.367 6.628 6.002 5.724 Period 15 7.606 6.811 6.142 5.847 16% 18% 20% 0.862 0.847 0.833 1.605 1.566 1.528 2.246 2.174 2.106 2.690 2.589 4.833 4.494 4.192 Period 16 5.029 4.656 4.327 5.197 4.793 4.439 5.342 4.910 4.533 5.468 5.008 4.611 5.575 5.092 4.675 14.718 13.578 12.561 11.652 10.838 10.106 9.447 8.851 8.313 6.974 6.265 5.954 5.669 5.162 4.730 Period 17 15.562 14.292 13.166 12.166 11.274 10.477 9.763 9.122 8.544 7.120 6.373 6.047 Period 18 16.398 14.992 13.754 12.659 11.690 10.828 10.059 9.372 8.756 8.201 7.250 6.467 6.128 Period 19 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 6.198 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7.469 6.623 6.259 Period 21 18.857 17.011 15.415 14.029 12.821 11.764 10.836 10.017 9.292 8.649 7.562 6.687 6.312 5.973 5.384 4.891 Period 22 19.660 17.658 15.937 14.451 13.163 12.042 11.061 10.201 9.442 8.772 7.645 6.743 6.359 6.011 5.410 4.909 Period 23 20.456 18.292 16.444 14.857 13.489 12.303 11.272 10.371 9.580 8.883 7.718 6.792 6.399 6.044 5.432 4.925 Period 24 21.243 18.914 16.936 15.247 13.799 12.550 11.469 10.529 9.707 8.985 7.784 6.835 6.434 6.073 5.451 4.937 Period 25 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 7.843 6.873 5.749 5.222 4.775 5.818 5.273 4.812 5.877 5.316 4.844 5.929 5.353 4.870 6.464 6.097 5.467 4.948 8.244 7.786 8.559 8.061 7.824 8.022 Future Value of $1 Periods 1% 2% 3% Period 1 1.010 Period 2 1.020 Period 3 1.030 Period 4 1.041 Period 5 1.051 Period 6 Period 7 Period 8 Period 9 Period 10 1.105 Period 11 1.116 1.243 Period 12 1.127 1.268 Period 13 1.138 Period 14 1.149 Period 15 1.161 4% 5% 6% 7% 1.020 1.030 1.040 1.050 1.060 1.070 1.040 1.061 1.082 1.103 1.124 1.145 1.061 1.093 1.125 1.158 1.191 1.225 1.082 1.126 1.170 1.216 1.262 1.311 1.104 1.159 1.217 1.276 1.338 1.403 1.062 1.126 1.194 1.265 1.340 1.419 1.501 1.072 1.149 1.230 1.316 1.407 1.504 1.606 1.714 1.828 1.949 1.083 1.172 1.267 1.369 1.477 1.594 1.718 1.094 1.195 1.305 1.423 1.551 1.689 1.838 1.219 1.344 1.480 1.629 1.791 1.967 1.384 1.539 1.710 1.898 2.105 2.332 2.580 2.853 1.426 1.601 1.796 2.012 2.252 2.518 2.813 3.138 1.294 1.469 1.665 1.886 2.133 2.410 2.720 3.066 3.452 1.319 1.513 1.732 1.980 2.261 2.579 1.346 1.558 1.801 2.079 2.397 2.759 3.172 3.642 4.177 8% 9% 10% 1.080 1.090 1.100 1.166 1.188 1.210 1.260 1.295 1.331 1.360 1.412 1.464 1.574 1.689 1.749 1.469 1.539 1.611 1.762 1.925 2.011 12% 14% 15% 1.120 1.140 1.150 1.254 1.300 1.323 1.405 1.482 1.521 1.587 1.677 1.772 1.974 2.195 2.313 2.211 2.502 2.660 1.851 1.993 2.144 2.476 2.853 3.059 1.999 2.172 2.358 2.773 3.252 3.518 2.159 2.367 2.594 3.106 3.707 4.046 3.479 4.226 4.652 3.896 4.818 5.350 4.363 5.492 6.153 2.937 3.342 3.798 4.887 6.261 7.076 5.474 7.138 8.137 Period 16 1.173 1.373 Period 17 1.184 1.400 Period 18 1.196 1.428 Period 19 1.208 1.457 Period 20 1.220 1.486 1.605 1.873 2.183 2.540 2.952 3.426 3.970 4.595 1.653 1.948 2.292 2.693 3.159 3.700 4.328 5.054 1.702 2.026 2.407 2.854 3.380 3.996 4.717 5.560 1.754 2.107 2.527 3.026 3.617 4.316 5.142 6.116 1.806 2.191 2.653 3.207 3.870 4.661 5.604 6.727 6.130 8.137 9.358 6.866 9.276 10.76 7.690 10.58 12.38 8.613 12.06 14.23 9.646 13.74 16.37 Period 21 1.232 1.516 Period 22 1.245 1.546 Period 23 1.257 1.577 Period 24 Period 25 1.270 1.282 1.608 1.641 1.860 2.279 2.786 3.400 4.141 5.034 6.109 7.400 10.80 15.67 18.82 1.916 2.370 2.925 3.604 4.430 5.437 6.659 8.140 12.10 17.86 21.64 1.974 2.465 3.072 3.820 4.741 5.871 7.258 8.954 13.55 20.36 24.89 2.033 2.563 3.225 4.049 5.072 6.341 7.911 9.850 15.18 23.21 28.63 2.094 2.666 3.386 4.292 5.427 6.848 8.623 10.83 17.00 26.46 32.92 Future Value of Ordinary Annuity of $1 Periods 1% 2% 3% Period 1 1.000 1.000 1.000 1.000 Period 2 2.010 2.020 2.030 2.040 Period 3 3.030 3.060 3.091 3.122 4% 2.050 3.153 Period 4 Period 5 4.060 4.122 4.184 4.246 4.310 5.101 5.204 5.309 5.416 5.526 5% 6% 1.000 1.000 2.060 3.184 4.375 5.637 Period 6 Period 7 6.152 6.308 6.468 6.633 6.802 7.214 7.434 7.662 7.898 8.142 Period 8 8.286 8.583 8.892 9.214 9.549 9.897 Period 9 9.369 9.755 10.16 10.58 11.03 11.49 Period 10 10.46 10.95 11.46 12.01 12.58 13.18 13.82 7% 8% 9% 10% 12% 14% 15% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2.070 2.080 2.090 2.100 2.120 2.140 2.150 3.215 3.246 3.278 3.310 3.374 3.440 3.473 4.440 4.506 4.573 4.641 4.779 4.921 4.993 5.751 5.867 5.985 6.105 6.353 6.610 6.742 6.975 7.153 7.336 7.523 7.716 8.115 8.536 8.754 8.394 8.654 8.923 9.200 9.487 10.09 10.73 11.07 10.260 10.64 11.03 11.44 12.30 13.23 13.73 11.98 12.49 13.02 13.58 14.78 16.09 16.79 14.49 15.19 15.94 17.55 19.34 20.30 Period 11 11.57 12.17 12.81 13.49 14.21 14.97 Period 12 Period 13 Period 14 14.95 15.97 17.09 18.29 12.68 13.41 14.19 15.03 13.81 14.68 15.62 16.63 17.71 19.60 15.92 Period 15 16.10 17.29 18.60 20.02 21.58 23.28 15.78 16.65 17.56 18.53 20.65 23.04 24.35 16.87 17.89 18.98 20.14 21.38 24.13 27.27 29.00 18.88 20.14 21.50 22.95 24.52 28.03 32.09 34.35 21.02 22.55 24.21 26.02 27.98 32.39 37.58 40.50 25.13 27.15 29.36 31.77 37.28 43.84 47.58 Period 16 17.26 18.64 20.16 21.82 Period 17 18.43 20.01 21.76 23.70 25.84 Period 18 19.61 21.41 23.41 25.65 28.13 Period 19 20.81 22.84 25.12 27.67 30.54 Period 20 22.02 24.30 26.87 29.78 33.07 Period 21 23.24 25.78 28.68 31.97 35.72 Period 22 24.47 27.30 30.54 34.25 38.51 23.66 25.67 28.21 27.89 30.32 33.00 35.95 30.84 33.75 36.97 40.54 30.91 42.75 50.98 55.72 48.88 59.12 65.08 34.00 37.45 41.30 45.60 55.75 68.39 75.84 33.76 37.38 36.79 41.00 41.45 46.02 51.16 45.76 51.16 57.28 63.44 78.97 88.21 72.05 91.02 102.4 39.99 44.87 50.42 56.76 64.00 81.70 104.8 118.8 43.39 Period 23 25.72 28.85 32.45 36.62 41.43 47.00 Period 24 26.97 30.42 34.43 39.08 44.50 Period 25 50.82 28.24 32.03 36.46 41.65 47.73 54.86 49.01 55.46 62.87 71.40 92.50 120.4 137.6 53.44 60.89 69.53 79.54 58.18 66.76 76.79 88.50 104.6 138.3 159.3 118.2 158.7 184.2 63.25 73.11 84.70 98.35 133.3 181.9 212.8 Requirements 1. Compute the payback, the ARR, the NPV, the IRR, and the profitability index of this investment. 2. Recommend whether the company should invest in this project. Print Done