The Speedy-Deivery Company has wo options for its delivery truck. The first optsion is to purchase a new truck for $14,000. The new truck will have a useful life of 5 years and a residual value of $3,000. Operating costs for the new truck wil be $500. The second option is to overhaul its existing truck. The cost of the overhaul will be $4,000. The overhauled truck will have a useful life of 5 years and a residual value of $O. Operating costs for the overhauled truck will be $600. Using Speedy's dscount rate of 6%, which option is better and by what amount? EEl (Cick the loon to view the present value of $1 table) (Cick the icon to view the present value of annuity of $1 table) 0 A. Better to overhaul by $17.579 OB. Better to overhaul by $7.338 OG. Better to purchase new by $7,338 Data Table D. Better to purchase new by $17,579 Present Value of $1 Periods 0.855 0.822 0 823 0.784 0.792 Data Table 705 Print Done Present Value of 3.630 4.452 5.242 .546 4.329 5.076 3.465 4212 4917 Print Done The Siverside Company is considering investing in two aternative projects: Useful ife (years) Estimated annual net cash inflows for useful Ide Residual value Depreciaion method Required rate of return $40,000 10,000 Straight-line Straight-ine $120000 32.000 11% What is the accounting rate of returm for Project 27 (Round any intermediary calculations to the nearest dollar, and round your final answer to the nearest hundredth of a percent, X.XX) If accounting rate of return is used to select the project which project would be chosen? A 2.98% and choose Project 2 B. 2.38% andchoose Project 1 C. 2.38% and choose Project 2 D. 2.98% and choose Project 1 Perry Enterprises is considering purchasing a new machine with a total cost of $31,600 and a usetul lide of 4 years. The machine will produce net cash infows of $7,600 over its useful Iide and has a residual value of $1.510. What is the payback period for the new machine? If Perry Enterprises requires a 5 year payback would they purchase the new machine? OA. 4.16 years and not purchase the new machine B. 5.19 years and not purchase the new machine C. 4.16 years and purchase the new machine OD. 3.47 years and purchase the new machine Dandy's Fun Park is evaluating the purchase of a new game to be located on its Midway Dandy's has narowed their choices down to two: the Wacky Water Race game and the Whack-A-Mole game. Financial data about the two choices Wacky Water Whack-A Mole 22,000 Useful If Estimated annual net cash infows for 8 years Residual value Depreciation method Requred rate of return $10.000 4,000 straight- line 8% $8,000 4,000 straight- line 12% Using the net present value model, which alternative(s) should Family Fun Park select? A. The Wacky Water Race game should be selected and net present value is $6,726 higher O B. The Wacky Water Race game shouid be selected and net present value is $8,726 lower. C. The whack-A-Mole game should be selected and net present value is $7,270 lower. 0 D. The \acky Water Race game should be selected and net present value is $7.270 higher All else being equal, when using the payback period method to compare the capital investment between several options, a company would choose to invest in the capital asset if which of the following is true? A. The payback period is the longest of all of the options. O B. If the expected accounting rate of returm is less than the required rate of return. OC. If the payback period equals the amount invested O D. The payback period is the shortest of all of the options