oetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.): Investment required in equipment $ 36,000 Annual cash inflows $ 8,400 Salvage value of equipment $ 0 Life of the investment 15 years Required rate of return 10 % The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment. The simple rate of return for the investment (rounded to the nearest tenth of a percent) is: (Round your answer to 1 decimal place.)
oetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.): Investment required in equipment $ 36,000 Annual cash inflows $ 8,400 Salvage value of equipment $ 0 Life of the investment 15 years Required rate of return 10 % The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment. The simple rate of return for the investment (rounded to the nearest tenth of a percent) is: (Round your answer to 1 decimal place.)
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 3CMA
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Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):
Investment required in equipment | $ | 36,000 | |
Annual |
$ | 8,400 | |
Salvage value of equipment | $ | 0 | |
Life of the investment | 15 | years | |
Required |
10 | % | |
The company uses straight-line
The simple rate of
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