Harwell Printing Co. is considering the purchase of new electronic printing equipment. It would allow Harwell to increase its net income by $46,800 per year. Other information about this proposed project follows: Initial investment $240,000 3 years Useful life Salvage value $105,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Harwell. (Round your percentage answer to 1 decimal place.) 2. Calculate the payback period for Harwell. (Round your answer to 2 decimal places.) 1. Accounting Rate of Return % 2. Payback Period years

Harwell Printing Co. is considering the purchase of new electronic printing equipment. It would allow Harwell to increase its net income by $46,800 per year. Other information about this proposed project follows: Initial investment $240,000 3 years Useful life Salvage value $105,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Harwell. (Round your percentage answer to 1 decimal place.) 2. Calculate the payback period for Harwell. (Round your answer to 2 decimal places.) 1. Accounting Rate of Return % 2. Payback Period years

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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