The ARR of the sandbox toy project with a residus value of $200.000 would be 16.12 Does this vivement pass Play Lite's ARR Screening? The ARR exceeds Phye's minimum required ARR. Therefore the sandbox to the masse Choose from any or any number in the inputs and then conto the Play Life Products is considering producing toy action figures and sandbox toys. The products require different specialized machines, each costing $1 milion. Each machine has a five-year life and zero residual value. The two products have different patterns of predicted net cash inflows. Click the icon to view the data.) dbox toy project's ARR. If the sandbox toy project had a residual value of $200,000, would the ARR change? Explain and recalculate i necessary. Does this investment pass Play Life's ARR screening rule? Caice Data Table Average annual operating income from asset Initial investment 1000000 Accounting rate of retum 161225 16.12 If the sandbox toy project had a residual value of $200,000, would the ARR change? Explain and recalculate if necessary If the sandbox toy project had a $200,000 residual value, the ARR would change The residual value would cause the yearly depreciation expense to decrease which will cause the average annual operating income from the investment to increase (Enter your answer as a percent rounded to two decimal places.) The ARR of the sandbox toy project with a residual value of $200,000 would be Does this investment pass Play Life's ARR screening rule? The ARR exceeds Play Life's minimum required ARR. Therefore, the sandbox toy project passes the company's screening rule 16 12 % Choose from any list or enter any number in the input fields and then continue to the next question 1 Data Table Annual Net Cash Inflows Year Toy action Sandbox toy figure project project 1... $ 321,225 $ 525.000 2..... 321,225 390,000 3. ... 321,225 325,000 4. 321,225 280,000 321,225 5. .... 40,000 $ 1,606,125 $ 1,560,000 Total Play Life will consider making capital investments only if the payback period of the project is less than 3.5 years and the ARR exceeds 8%. Print Done
