The Present Value of $1 table:

The Present Value of Ordinary Annuity of $1 table:

The Future Value of $1 table:

The Future Value of Ordinary Annuity of $1:

Recommendation: Water City (SHOULD/SHOULD NOT) invest in the project because the payback period is (GREATER THAN/ LESS THAN) the operating life, the NPV is (NEGATIVE/POSITIVE) , the profitability index is (GREATER THAN/ LESS THAN) one, and the ARR and IRR are (GREATER THAN/ LESS THAN) the company's required rate of return.

Reference Periods 1% 0.990 0.980 0.971 0.961 0.951 6% | 0.943 0.890 | 0.840 | 0.792 0.747 15% 0.870 0.756 0.658 0.572 0.497 0.579 0.386 0.942 0.933 0.923 0.914 0.905 0.896 0.887 0.879 0.870 0.861 2% 3% | 0.980 0.971 0.961 0.943 0.942 0.915 0.924 0.888 0.906 0.863 0.888 0.837 0.871 0.813 0.853 0.789 0.837 0.766 0.820 0.744 0.8040.722 0.788 0.701 0.773 0.681 0.758 0.661 0.743 0.642 0.7280.623 0.714 0.605 0.700 0.587 0.686 0.570 0.673 0.554 0.660 0.538 0.647 0.634 0.507 0.622 0.492 0.610 0.478 0.598 0.464 0.586 0.450 0.574 0.437 0.563 0.424 0.552 0.412 0.453 0.307 0.372 0.228 4% 5% 0.962 0.952 0.925 0.907 0.889 0.864 0.855 0.823 0.822 0.784 | 0.790 0.746 0.760 0.711 0.731 0.677 0.703 0.645 0.676 | 0.614 0.650 0.585 0.625 0.557 0.601 0.530 0.577 0.505 0.555 0.481 0.534 0.458 0.513 0.436 0.494 0.416 0.475 0.396 0.456 0.377 0.439 0.359 0.422 0.342 0.406 0.326 0.390 0.310 0.375 0.295 0.361 0.281 0.347 0.268 0.333 0.255 0.321 0.308 | 0.231 0.208 0.142 0.141 0.087 0.853 0.844 0.836 0.828 0.820 0.811 0.803 0.795 0.788 0.780 0.772 0.764 0.757 0.749 Present Value of $1 7% 8% 9% 10% 0.935 0.926 0.917 0.909 | 0.873 0.857 0.842 0.826 0.816 0.794 0.772 0.751 | 0.763 0.735 0.708 0.683 0.713 0.681 0.650 0.621 0.6660.630 0.596 0.564 0.623 0.583 0.547 0.513 0.582 0.540 0.502 0.467 0.544 0.500 0.460 0.424 0.508 0.463 0.422 0.475 0.429 0.388 0.350 | 0.444 0.397 | 0.356 0.319 | 0.415 0.368 0.326 0.290 | 0.388 0.340 0.299 0.263 0.362 0.315 0.275 0.239 0.3390.292 0.252 0.218 0.317 0.270 0.231 0.198 0.296 0.250 0.212 0.180 0.277 0.232 0.194 0.164 0.258 0.215 0.178 0.149 0.242 0.199 0.164 0.135 | 0.226 0.184 0.150 0.123 | 0.211 0.170 0.138 0.112 0.197 0.158 0.126 0.102 0.184 0.146 0.116 0.092 0.172 0.135 0.106 0.084 0.161 0.125 0.098 0.076 0.150 0.116 0.090 0.069 0.141 0.107 0.082 0.063 0.131 0.099 0.075 0.057 0.067 0.046 0.032 | 0.022 0.034 0.021 0.013 0.009 0.705 0.665 0.627 0.592 0.558 0.527 0.497 0.469 0.442 0.417 0.394 0.371 0.350 0.331 0.312 0.294 0.278 0.262 0.247 0.233 0.220 0.207 0.196 0.185 0.174 0.097 0.054 12% 14% 0.893 0.877 0.797 0.769 0.712 0.675 0.636 0.592 0.567 0.519 0.507 | 0.456 0.452 0.400 | 0.404 0.351 0.361 | 0.308 0.322 0.270 0.287 0.237 0.257 0.208 0.229 0.182 0.205 0.160 0.183 0.140 0.163 0.123 0.146 0.108 0.130 0.095 0.116 0.083 0.104 0.073 0.093 0.064 0.083 0.056 0.074 0.049 0.066 0.043 0.059 0.038 0.053 0.033 0.047 0.029 0.042 0.026 0.037 0.022 0.033 0.020 0.011 0.005 0.003 0.001 0.432 0.376 0.327 0.284 0.247 0.215 0.187 0.163 | 0.141 0.123 0.107 0.093 0.081 0.070 0.061 0.053 0.046 0.040 0.035 0.030 0.026 0.023 0.020 0.017 0.015 0.004 0.001 16% 18% 20% 0.862 0.847 0.833 0.743 0.7180.694 0.641 0.609 0.552 0.516 0.482 0.476 0.437 0.402 0.410 0.370 0.335 0.354 0.314 0.279 0.305 0.266 0.233 0.263 0.225 0.194 0.227 0.191 0.162 0.195 0.162 0.135 0.168 0.137 0.112 0.145 0.116 0.093 0.125 0.099 0.078 0.108 0.084 | 0.065 0.093 0.071 0.054 0.080 0.060 0.045 0.069 0.051 0.038 0.060 0.043 0.031 0.051 0.037 0.026 0.044 0.031 0.022 0.038 0.026 0.018 0.033 0.022 0.015 0.028 0.019 0.013 0.024 0.016 0.010 0.021 0.014 0.009 0.0180.011 0.0160.010 0.006 0.014 0.008 0.012 0.007 0.004 0.003 0.001 0.001 0.001 0.522 0.007 0.243 0.005 0.742 0.672 Print Done 1385 via 865 Present Value of Ordinary Annuity of $1 Ferious | 1% | 2 | 3 | 4% | | 5 | 66 | 7. | 8 | 9% | 10% | 12 114.1 15% | 16 18 | 201 0.330 | 0.980 | 1971 1 0.362 10.952 1 943 1 0935 | 0.26 10917 10309 | 0.893 0.877 10.80 10.852 10.87 10.233 1.370 | 1.342 | 1913 | 1.888 | 1.25 | 1.233 | 1.808 | 1. 78 | 1.758 | 1.736 | 1.590 1.547 | 1.626 | 1.605 | 1.566 | 1.528 2941 | 2.28. | 2.823 | 2.775 | 2.723 | 2.73 2.522 2.577 | 2.531 12.187 2.402 2.322 | 2.283 | 2.246 | 2.174 3302 | 3.808 | 3.717 | 3.630 3.546 | | 3465 3.387 | 3312 3240 3.170 | 3.037 2014 2.255 | 2. 78 | 2.590 2.588 4.253 4.713 | 4.580 | 4.52 4.323 14.212 | 4.100 3. 93 3.880 3791 3.505 3433 3.352 | 3272 | 3.127 2991 5.795 5.501 | 5.17 | 5.242 5.076 | 4317 4.767 4.523 485 4.355 4.111 3288 3.78. | 3.685 | 3.498 3.326 6.728 6.472 | 6.230 6.002 5.786 | 5.582 | 5.206 15.033 4.868 14.564 4.288 4.160 | 4.39 3.212 3.505 7.552 7.325 | 7.020 16.733 6.463 | 5.210 5.971 | 5.747 15.535 5.335 | 4.968 4.38 4.487 4.3.4 4.078 3.37 8.566 8.162 | 7.786 | 1435 7.108 6.802 6.515 | 6.247 | 5.985 5.758 | 5.328 4.946 4.772 4.507 4.303 4.31 9471 8.983 | 8.530 | 8.111 7.722 7.360 7.024 6.710 6-18 6.145 15.650 5.216 5.013 4.233 14.94 4.192 10.368 | 3.787 | 3.253 | 8.760 | 2306 | 7.887 7.499 7.139 | 6.805 | 6.495 | 5.938 | 5453 5.234 5.029 4.656 4.327 10.575 | 3954 | 9.385 | 8.863 | 8.38. 7.943 | 7.536 17.161 | 6.814 | 6.194 15.560 5.421 5.137 4.793 4.439 11.348 | 10.635 | 9.986 | 9.382 | 8.853 8.358 | 7.904 | 7287 17.18] 6.24 5.842 5.583 5.342 4.210 4.533 | 12.106 | 11.296 | 10. 53 | 3. 89 | 9.235 | 3.745 | 8.2.. | 7.786 | 7.367 | 6.628 5.002 5.724 | 5.468 | 5.008 4.611 | 12.849 | 11.938 | 11.118 | 10.30 19712 | 3.108 | 3.559 | 8.061 | 7.06 | 6.811 6.142 5.247 5575 | 5.092 4.575 14.718 13.578 | 12.561 | 11.652 | 10.88 | 10.116 192.7 8851 | 8313 |1.824 | 6.37. 6.265 5.35 | 5.56% | 5.162 4.730 15.562 | 1.292 | 13.166 | 12.166 | 11.274 | 10. 47 9.763 19.122 | 8.5.2 .022 17.120 6.373 6.047 5.749 5.222 4.775 16.398 | 14.92 | 13.754 12.659 | 11.690 | 10.828 | 10.059 19372 | 3.756 8.201 7.250 6467 6.128 5.218 5.273 4.312 7.226 | 16.678 | 14.324 3.134 | 12.085 | 11.153 | 10.336 19.604 8.250 13.365 7.365 6.550 6.193 5.877 5.316 4.84 18.045 | 16.351 | 14.877 2.590 | 12.462 | 11470 9818 3125 18.512 | 2463 5.623 6.253 5.323 5.353 4.370 18.857 17.01 | 15-15 14.029 | 12.221 | 11.764 | 10.236 10.017 9.292 8.5.3 7.562 6.587 6.312 5.373 5.384 4.881 9.660 17.558 15.937 1.451 13.163 12.042 11.061 10.201 32.2 8.772 7.25 6.743 6.359 6.011 5-10 4.309 18.292 16.4.4 1.857 13.8 12.303 11.272 10.371 9.580 8.883 7.718 6.792 6.393 16.0.2 5.32 21.243 18.914 16.936 6.227 13.799 12.550 11.469 10.529 19.707 | 8.985 7.784 6.835 6.34 6.073 5.51 22.023 19.523 17.13 15.622 1.034 12.783 11.554 10.575 19.823 | 2.077 7.8.3 6.873 6.6. | 6.07 5.467 22.795 20.121 17.877 15.983 14.375 3.03 11.326 10.810 12.925 | 3.151 | 7.895 6.306 6.491 | 6.118 4.956 23.550 20.707 18.327 16.330 12.6.3 13.211 10.335 | 10.027 | 9.237 | 7.943 6.335 6.512 | 6.136 4.354 22.316 21.281 18.764 16.663 14.898 | 13.406 11.051 10.116 | 3.307 | 7.984 6.51 6.532 | 6.152 4.970 25.066 21.8.4 19.188 16.984 | 15.141 | | 13.591 | 11.158 | 10.198 | 9.370 || 8.022 6.983 16.551 16.166 5.510 25.803 22.396 19.500 | 17.292 | 15.372 | 13.755 | 12.409 1.258 | 10.274 | 9427 | 2.055 7.003 | 6.566 | 6.177 5.517 1373 32.835 | 27.355 | 23.15 | 19.79 | 7. 159 | 15.046 | 13.32 11.925 | 10.757 | 9.779 | 8.242 7.105 | 6.642 6.233 5.548 4.997 | 39.196 | 31.424 | 25.730 | 21.82 | 18.256 | 15.762 | 13.801 | 12.233 | 10.962 | 9.915 | 2.304 | 1.133 | 6.661 | 5.55 | 1999 10.594 4es 198 4.375 1.72 1.105 1.523 Future Value of $1 | Farocs | 19 | 2 | | 4% | 58 | 68 | 7 | 88 | 9 | 108| 121 14 | 15% 1.010 | 1.020 11.030 | 1.040 | 1.050 | 1.060 | 1.070 11.080 | 1.090 | 1.100 | 1.120 | 1.140 | 1.150 1.020 | 1.04 | 1.061 | 1.022 | 1.18 | 1.124 | 1.145 | 1.166 | 1.188 1.210 1.254 | 1.300 | 1.323 1.030 | 1.61 || 1.093 | 1.125 | 1.158 | 1.181 1.225 | 1.250 | 1.295 1.331 1.405 | 1.482 | 1.521 1.041 | 1. 02 | 1.126 | 1.170 | 1.216 1.262 1.31 | | 1.360 | 1.12 1.464 1.574 | 1.588 | 1.79 1.151 1.104 1.159 | 1.217 | 1.276 1388 1.40 | | 1.69 | 1.539 1.5l1 1.762 1.925 | 2011 1.062 1.125 1.134 | 1.255 | 1.340 1.19 1.501 1.587 1.677 1.974 2.195 2.313 1.072 1.149 1.230 1.316 | 1.407 1.504 1.56 1.714 1.228 1.948 2211 2.502 2.660 1.083 1.172 1.267 1.369 | 1.477 1.594 1.718 1.851 1993 2.11. 2.476 2.253 3.055 1.094 1.195 1.305 1.23 | 1.551 1.68 1.888 1.999 2.172 2.358 2. 73 3.252 3.518 1.219 1.3.2 1.80 1.781 1.967 2.158 2.367 2.594 3.106 3.707 4.046 1.16 1.243 1.384 1.538 | 1.710 1.888 2.115 2.332 2.580 2.853 3479 | | 4.226 4.652 1.127 1.268 1.26 1.601 1.796 2.12 2.252 2.513 2.313 3.138 3.886 | 14.818 5.350 1.138 1.234 1.469 1.665 1.885 2.133 2.10 2.720 3.066 3452 4.363 | 5492 6.153 1.149 1.313 1.513 1.732 1.980 2.261 2.579 2337 3342 3798 4.87] 6.251 7.075 1.151 1.346 1.558 1.801 2.078 2.397 2.759 3.172 3542 4.177 5474 | 7.138 8.137 1.13 1.373 1.505 1373 2.183 2.540 2952 3.26 3970 4.585 6.130 | 8.137 9.358 1.400 1.653 1.948 2.893 3.153 4.323 5.05. 6.366 9.276 10.76 11.28 1.702 2.026 407 2.82 3.380 3.996 | 4.717 5.560 1.80 | 10.58 12.38 1.208 | 1.457 1.754 2.107 2.527 | 3.025 3.617 4.316 | 5.142 6.116 | 12.06 1.23 1.220 | 1.486 1.806 2.131 2.653 3207 3.870 4.561 | 5.504 6.727 3.546 3.74 | 1.516 | 1.260 2.279 2.786 3400 4.1.1 15.03. | 6.109 7.400 10.80 | 15.57 | 1.546 1.916 2.370 2.925 3.604 4.430 5.37 | 6.553 3.140 12.10 17.86 | 1.57 1.374 2.465 | 3.072 3820 4.741 5.871 | 1.258 8.35. 3.55 | 1.08 | 2.033 2.562 ) 4.0.3 5.072 6.341 | 7911 2.850 15.18 28.21 | 1.5.1 2.034 2.666 | 3.326 4.232 5.427 6.248 | 8.623 10.88 17.00 26.46 | 1.673 2.157 | 2.772 3.566 | 4.549 5.807 | 1.396 | 9.399 1.92 19.04 1.707 | 2.221 | 2.283 | 3733 4.222 6.212 |1.98 | 10.25 3.11 21.32 1.741 | 2.288 | 2999 3.320 5.112 6.49 | 8.627 | 11.17 14.2 1.776 | 2.357 | 3.119 | 4.116 5.18 7.14 | 9.317 | 12.17 15.86 26.75 1.811 | 2.427 | 3.243 | 4.322 5.743 1.612 | 10.06 | 13.27 7.45 28.96 50.35 66.21 2.208 3.252 | 4.801] 7.040 10.29 14.97 | 21.72 | 31.41 45.26 93.05 1882 2673 1.545 | 2592 | 4.38. | | 1147 1842 | 22 45 | 46.30 | 74.36 | 1174 | 288.0 7002 | 1,084 292 3.700 8613 | 1.232 245 1257 20.36 3225 2017 Reference Periods 14% 1.000 2.140 3.440 4.921 6.610 1% 2% 1.000 1.000 2.010 2.020 3.030 3.060 4.0604.122 5.101 5.204 6.152 6.308 7.214 7.434 8.286 8.583 9.369 9.755 10.46 10.95 11.57 12.17 12.68 13.41 13.81 14.68 15% 1.000 2.150 3.473 4.993 6.742 8.754 11.07 8.536 10.73 3% 1.000 2030 3.091 | 4.184 5.309 6.468 7.662 8.892 10.16 11.46 12.81 14.19 15.62 17.09 18.60 20.16 13.23 16.09 16.10 17.29 47.58 Future Value of Ordinary Annuity of $1 4% 5% 6% 7% 8% 9% 10% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2040 2050 2.060 2.070 2.080 | 2.090 2.100 3.122 3.153 3.1843.215 3.246 3.278 3.310 4.246 | 4.310 4.375 4.440 4.506 4.573 4.641 5.416 5.526 5.637 5.751 5.867 5.985 6.105 6.633 6.802 6.975 | 7.153 7.336 7.523 7.716 | 7.898 8.142 8.394 8.654 8.923 9.200 9.487 9.214 9.549 9.897 10.260 10.64 11.03 | 11.44 10.58 11.03 11.49 11.98 12.49 13.02 13.58 12.01 12.58 13.18 13.82 14.49 15.19 15.94 13.49 14.21 14.97 15.78 16.65 17.56 18.53 15.03 15.92 16.87 17.89 18.98 20.14 21.38 16.63 17.71 18.88 20.14 21.50 22.95 24.52 18.29 22.55 2421 26.02 27.98 20.02 21.58 25.13 27.15 29.36 31.77 21.82 23.66 30.32 33.00 35.95 23.70 25.84 30.84 33.75 36.97 40.54 25.65 28.13 37.45 41.30 45.60 27.67 30.54 41.45 46.02 51.16 29.78 33.07 41.00 45.76 51.16 57.28 35.72 44.87 50.42 56.76 64.00 38.51 43.39 49.01 55.46 62.87 71.40 41.43 47.00 53.44 60.89 69.53 79.54 39.08 44.50 50.82 58.18 66.76 76.79 88.50 41.65 47.73 54.86 63.25 73.11 84.70 98.35 44.31 51.11 59.16 68.68 79.95 | 93.32 109.2 47.08 54.67 63.71 74.48 87.35 102.7 121.1 49.97 58.40 68.53 95.34 113.0 1342 52.97 62.32 73.64 87.35 104.0 124.1 148.6 56.08 66.44 79.06 94.46 113.3 136.3 164.5 95.03 120.8 154.8 199.6 259.1 337.9 442.6 152. 7 209.3 290.3 406.5 573.8 815.1 1,164 27.89 12% 1.000 2.120 3.374 4.779 6.353 8.115 10.09 12.30 14.78 17.55 20.65 24.13 28.03 32.39 37.28 42.75 48.88 55.75 63.44 72.05 81.70 92.50 104.6 118.2 133.3 150.3 169.4 190.7 214.6 241.3 767.1 2,400 65.72 21.76 23.41 25.12 3738 08 0.70 28.68 31.97 19.34 23.04 27.27 32.09 37.58 43.84 50.98 59.12 68.39 78.97 91.02 104.8 120.4 138.3 158.7 181.9 208.3 238.5 272.9 312.1 356.8 1,342 4,995 26.97 28.24 30.42 32.03 33.67 30.54 32.45 3443 36.46 38.55 40.71 42.93 45.22 47.58 75.40 1128 65.08 75.84 88.21 102.4 118.8 137.6 159.3 1842 212.8 245.7 283.6 327.1 377.2 434.7 1,779 7,218 80.70 64.46 84.58 Water City is considering purchasing a water park in Atlanta, Georgia, for $1,870,000. The new facility will generate annual net cash inflows of $475,000 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 10% 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.) (Click the icon to view Future Value of Ordinary Annuity of $1 table.) Read the requirements = = Payback years bunting rate of return (ARR). (Round the percentage to the nearest tenth percent, X.X%.) Amount invested Average amount invested Expected annual net cash inflow Present value of net cash inflows = ] = 0 ARR % 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 ] - D years Next, determine the formula and calculate the accounting rate of return (ARR). (Round the percentage to the nearest tenth percent, X.X%.) = ARR Calculate the net present value (NPV). (Enter any factor amounts to three decimal places, X.XXX.) Net Cash Inflow Annuity PV Factor (i=10%, n=8) Present Value Years 1-8 Present value of annuity 0 Investment Net present value of the investment The IRR (internal rate of return) is between Finally, determine the formula and calculate the profitability index. (Round your answer to two decimal places, X.XX.) = Profitability index Requirement 2. Recommend whether the company should invest in this project. Recommendation: Water City profitability index is invest in the project because the payback period is the operating life, the NPV is one, and the ARR and IRR are the company's required rate of return. 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