E11-2 (Algo) Calculating Accounting Rate of Return, Payback Period (LO 11-1, 11-2] Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $93,475 per year. Other information about this proposed project follows: Initial investment Useful life Salvage value $430,760 8 years $ 56,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Bartlett (Round your percentage answer to 2 decimal places.) 2. Calculate the payback period for Bartlett (Round your answer to 2 decimal places.) 1. Accounting Rate of Retun 2. Payback Period years
E11-2 (Algo) Calculating Accounting Rate of Return, Payback Period (LO 11-1, 11-2] Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $93,475 per year. Other information about this proposed project follows: Initial investment Useful life Salvage value $430,760 8 years $ 56,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Bartlett (Round your percentage answer to 2 decimal places.) 2. Calculate the payback period for Bartlett (Round your answer to 2 decimal places.) 1. Accounting Rate of Retun 2. Payback Period years
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![E11-2 (Algo) Calculating Accounting Rate of Return, Payback Period (LO 11-1, 11-2]
Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $93,475 per
year. Other information about this proposed project follows:
Initial investment
Useful life
Salvage value
$430,760
8 years
$ 56,000
Assume straight line depreciation method is used.
Required:
1. Calculate the accounting rate of return for Bartlett. (Round your percentage answer to 2 decimal places.)
2. Calculate the payback period for Bartlett. (Round your answer to 2 decimal places.)
1. Accounting Rate of Retum
2. Payback Period
years](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6ed36922-6fdc-4573-8f6a-92a12e8cc77f%2Ffb83895c-a9ba-421a-9320-aba77d3faa37%2Flli825_processed.png&w=3840&q=75)
Transcribed Image Text:E11-2 (Algo) Calculating Accounting Rate of Return, Payback Period (LO 11-1, 11-2]
Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $93,475 per
year. Other information about this proposed project follows:
Initial investment
Useful life
Salvage value
$430,760
8 years
$ 56,000
Assume straight line depreciation method is used.
Required:
1. Calculate the accounting rate of return for Bartlett. (Round your percentage answer to 2 decimal places.)
2. Calculate the payback period for Bartlett. (Round your answer to 2 decimal places.)
1. Accounting Rate of Retum
2. Payback Period
years
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