Mitsui Electronics, Limited, is considering buying a labor-saving pierce of equipment and provided the following data: Purchase cost of the equipment $ 484,500 Annual cost savings that will be provided by the equipment $ 85,000 Life of the equipment 12 years Compute the simple rate of return on the equipment. Use straight-line depreciation based on the equipment’s useful life.
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Mitsui Electronics, Limited, is considering buying a labor-saving pierce of equipment and provided the following data:
Purchase cost of the equipment | $ 484,500 | |
---|---|---|
Annual cost savings that will be provided by the equipment | $ 85,000 | |
Life of the equipment | 12 |
years |
Compute the simple
Step by step
Solved in 2 steps
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