A machine costs $600,000 and is expected to yield an after-tax net income of $23,000 each year. Management predicts this machine has a 12-year service life and a $120,000 salvage value, and it uses straight-line depreciation. Compute this machine's accounting rate of return. Choose Numerator: Annual average investment aisag 22.000 1 L Accounts receivable Annual after-tax net income Annual average investment Annual pre-tax income Average total assets Accounting Rate of Return Choose Denominator: $ = 600,000 = Accounting Rate of Return Accounting rate of return 3.83 %

A machine costs $600,000 and is expected to yield an after-tax net income of $23,000 each year. Management predicts this machine has a 12-year service life and a $120,000 salvage value, and it uses straight-line depreciation. Compute this machine's accounting rate of return. Choose Numerator: Annual average investment aisag 22.000 1 L Accounts receivable Annual after-tax net income Annual average investment Annual pre-tax income Average total assets Accounting Rate of Return Choose Denominator: $ = 600,000 = Accounting Rate of Return Accounting rate of return 3.83 %

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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