Crowl Corporation is investigating automating a process by purchasing a machine for $805,500 that would have a 9 year useful life and salvage value. By automating the process, the company would save $139,500 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $22,500. The annual depreciation on the new machine would be $89,500. The simple rate of return on the investment is closest to ignore income taxes): (Round your answer to 1 decimal place.) Multiple Choice 6.39% 5.25% 16.85% 1125%
Crowl Corporation is investigating automating a process by purchasing a machine for $805,500 that would have a 9 year useful life and salvage value. By automating the process, the company would save $139,500 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $22,500. The annual depreciation on the new machine would be $89,500. The simple rate of return on the investment is closest to ignore income taxes): (Round your answer to 1 decimal place.) Multiple Choice 6.39% 5.25% 16.85% 1125%
Chapter9: Capital Budgeting And Cash Flow Analysis
Section: Chapter Questions
Problem 5P
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