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Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9 year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200, The simple rate of return on the investment is closest to (Ignore income taxes.): (Round your answer to 1 decimal place.) Multiple Choice 11.12% 16.72% 5.80% 512%

Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9 year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200, The simple rate of return on the investment is closest to (Ignore income taxes.): (Round your answer to 1 decimal place.) Multiple Choice 11.12% 16.72% 5.80% 512%

FINANCIAL ACCOUNTING
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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Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9 year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200. The simple rate of return on the investment is closest to (lgnore income taxes.): (Round your answer to 1 decimal place.) Multiple Choice 11.12% 16.72% 5.80% 512%
Transcribed Image Text:Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9 year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200. The simple rate of return on the investment is closest to (lgnore income taxes.): (Round your answer to 1 decimal place.) Multiple Choice 11.12% 16.72% 5.80% 512%
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