Question: answer the four requirements PLEASE!! Consider how Clare Valley, a popular ski resort, could use capital budgeting to decide whether the $8.5 million River Park
answer the four requirements PLEASE!!


Consider how Clare Valley, a popular ski resort, could use capital budgeting to decide whether the $8.5 million River Park Lodge expansion would be a good investment. (Click the icon to view the expansion estimates.) Assume that Clare Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $850,000 at the end of its nine-year life. Read the requirements, Requirement 1. Compute the average annual net cash inflow from the expansion. First enter the formula, then compute the average annual net cash inflow from the expansion. (Round your answer to the nearest dollar.) Average annual net cash inflow X 0 x Data table Assume that Clare Valley's managers developed the following estimates concerning a planned expansion to its River Park Lodge (all numbers assumed): 9 Number of additional skiers per day. 120 Average number of days per year that weather conditions allow skiing at Clare Valley 165 Useful life of expansion (in years)... Average cash spent by each skier per day $ 245 Average variable cost of serving each skier per day . $ 140 Cost of expansion $ 8,500,000 Discount rate 10% Print Done Requirements 1. 2. 3. 4. Compute the average annual net cash inflow from the expansion. Compute the average annual operating income from the expansion. Compute the payback period. Compute the ARR. Print Done
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