ABC company is considering constructing a plant. The land costs 15,000,000 pesos, the building costs 30,000,000 pesos, the equipment costs 12,500,000 pesos and 5,000,000 working a capital is required. At the end of 12 years, the land can be sold for 25,000,000 pesos, the building for 12,000,000 pesos and equipment for 250,000 and all the working capital recovered. The annual disbursements for labor, materials and all other expenses are estimated to cost 23,750,000 pesos. If the company requires a minimum return of 25%, what should be the minimum annual sales for 12 years to justify the investment? ANS (39,748,560 pesos) USE ANY METHOD YOU WANT TO TRY.

ABC company is considering constructing a plant. The land costs 15,000,000 pesos, the building costs 30,000,000 pesos, the equipment costs 12,500,000 pesos and 5,000,000 working a capital is required. At the end of 12 years, the land can be sold for 25,000,000 pesos, the building for 12,000,000 pesos and equipment for 250,000 and all the working capital recovered. The annual disbursements for labor, materials and all other expenses are estimated to cost 23,750,000 pesos. If the company requires a minimum return of 25%, what should be the minimum annual sales for 12 years to justify the investment? ANS (39,748,560 pesos) USE ANY METHOD YOU WANT TO TRY.

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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Please show the solution to the corresponding answer stated in the problem.
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