Exercise 12-8 payback period and simple rate of return [lo12-1, lo12-6] [the following information applies to the questions displayed below.] nick’s novelties, inc., is considering the purchase of new electronic games to place in its amusement houses. the games would cost a total of $672,000, have a fifteen-year useful life, and have a total salvage value of $67,200. the company estimates that annual revenues and expenses associated with the games would be as follows: revenues $ 260,000 less operating expenses: commissions to amusement houses $ 90,000 insurance 36,000 depreciation 40,320 maintenance 50,000 216,320 net operating income $ 43,680 exercise 12-8 part 2 2a. compute the simple rate of return promised by the games. 2b. if the company requires a simple rate of return of at least 5%, will the games be purchased?