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Consider how Preston Valley River Park Lodge could use capital budgeting to decide whether the $12,000,000 River Park Lodge expansion would be a good investment. Assume Preston Valley's managers developed the following estimates concerning the expansion: (Click the icon to view the estimates.) Read the requirements. 0 Requirements Requirement 1. Compute the average annual net cash inflow from the expansion. The average annual net cash inflow from the expansion is $ 1. Compute the average annual net cash inflow from the expansion. 2. Compute the average annual operating income from the expansion. Requirement 2. Compute the average annual operating income from the expansion A Data Table The average annual operating income from the expansion is $ 122 skiers Number of additional skiers per day Average number of days per year that weather conditions allow skiing at Preston Valley Useful life of expansion (in years) Average cash spent by each skier per day Average variable cost of serving each skier per day Cost of expansion Discount rate 142 days 10 years 239 $ 78 12,000,000 14% Assume that Preston Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $750,000 at the end of its ten-year life. Print Done Enter any number in the edit fields and then continue to the next

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