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[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
[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 $300,000, have an eight-year useful life, and have a total salvage value of $20,000. The company estimates that annual revenues and expenses associated with the games would be as follows: $200,000 Revenues Less operating expenses: Commissions to amusement houses Insurance Depreciation Maintenance $100,000 7,000 35,000 18,000 160,000 Net operating Income $ 40,000 3. valus 2.50 points Required: 1a Compute the pay back period associated with the new electronic games Payback Period Choose Denominator Choose Numerator: Payback Period Payback period years
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