Tom Bat became a baseball enthusiast at a very early age. All of his baseball experience has provided him valuable knowledge of the sport, and he is thinking about going into the batting cage business. He estimates the construction of a state-of-the-art building and the purchase of necessary equipment will cost $840,000. Both the facility and the equipment will be depreciated over 12 years using the straight-line method and are expected to have zero salvage values. His required rate of return is 9% (present value factor of 7.1607). Use PV of an Annuity of 1. Estimated annual net income and cash flows are as follows:

Revenue $350,500

Less:

Utility cost $40,000

Supplies$8,000

Labor141,000

Depreciation70,000

Other 38,500

297,500

Net income$53,000

Calculate:

Net present value

Internal rate of return

Cash payback period