[The following information applies to the questions displayed below) Nick's Novelties, Inc. is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $672,000, have an eight-year useful life, and have a total salvage value of $67,200. The company estimates that annual revenues and expenses associated with the games would be as follows: $260,000 Revenues Less operating expenses: Commissions to amusement houses Insurance Depreciation Maintenance Net operating income $90,000 36,000 75,600 50,000 251,600 $ 8.400 2. value 5.00 points Required: ta. Compute the pay back period associated with the new electronic games. Choose Numerator: Payback Period Choose Denominator: 11 Payback Period Payback period years 16. Assume that Nick's Novelties, Inc., will not purchase new games unless they provide a payback period of 10 years or less. Would the company purchase the new games? Yes No References eBook & Resources Worksheet Leaming Objective: 11-01 Determine the payback period for an investment Difficulty: 1 Easy Learning Objective: 11-04 Compute the simple rate of return for an investment Check my work 3. va 10.00 points 22. Compute the simple rate of return promised by the games. (Round your answer to 1 decimal place. Le 0.123 should be considered as 12.3%.) Simple rate of retum % 26. If the company requirds a simple rate of return of at least 5%, will the games be purchased? No Yes