Financial accounting Splish Brothers Company had an investmentthat cost $400,000 and had a salvage value atthe end of its useful life of zero. If Mussina'sexpected annual net income is $15,000, theannual rate of return is:a. 3.75%b. 7.50%c. 10.13%d. 9.38%

Step 1: Define Corporate FinanceCorporate finance identifies, evaluates, and manages financial…

Answered: Splish Brothers Company had an…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 2P

See similar textbooks

Similar questions

CC Company invested in a project which required an investment of P10,000 with a salvage value of P1,000 at the end of its 3 year life. The annual net income after income taxes are as follows: Year 1 P3,000 2 4,800 3 7,200 What is the payback period? Group of answer choices 1.897 yrs 1.513 yrs 1.487 yrs 1.385 yrs
MARR is 6% per year. First cost, S Annual cost. $ per year Revenue, S per year Salvage value, S Life, years Vendor 1 - 200,000 -50,000 120,000 25,000 10 of the following three relations, the correct one(s) to calculate the annual worth of vendor 1 cash flow estimates is (note: All dollar values are in thousands) Relation 1: AW₁ = -200(A/P,6 %,10) + 70 + 25(A/F,6%,10) Relation 2: AW₁ = [-200 - 50(P/4,6%,10) + 120(P/A,6%, 10) + 25(P/F,6%,10)] (4/P,6%,10) Relation 3: AW₁ = -200(F/P,6%,10) + 25 + (-50 +120)(A/P,6%,10).
1. An equipment has a first cost of P500,000 and the cost of installation is P30,000. If the salvage value is 10% equipment cost at the end of the its useful life of 5 years. Compute the book value at the end of 3rd year. Using: A. Straight Line Method B. Sum of Years Digit Method C. Sinking Fund Method (if money is worth 6% per annum) D. Declining Balance Method E. Using Double Declining Balance Method
Larkspur company is considering buying equipment for $360,000 with useful life of 5 year and. Financial accounting
A machine having a first cost of P 60,000.00 will be retired at the end of 8 years. Depreciation cost is computed using a constant percentage of the declining book value. What is the total cost of depreciation in pesos, up to the time the machine is retired if the annual rate of depreciation is 28.72%?
An investment of $2,000 provides an average net income of $400. Depreciation is $40 per year with zero salvage value. The ARR using the original investment is?
Denver Company buys a machine for $65,000 that has an expected life of 4 years and no salvage value. The company uses straight-line depreciation. The company anticipates a yearly net income of $3,100 after taxes of 30%, with the cash flows to be received evenly throughout each year. What is the accounting rate of return? Multiple Choice 2.86%. 4.77%. 19.08%. 9.54%. 6.68%.
am.133.
A machine having a first cost of P60,000 will be retired at the end of 8 years. Depreciation cost is computed using a constant percentage of the declining book value. What is the total cost of depreciation in pesos, up to the time machine is retired if the annual rate of depreciation is 28.73%? 57,000 56,000 58,000 59,000
A company project capitalized for $ 50,000 invested in depreciable assets will earn a uniform annual income of $ 19,849 in 10 years. The costs for operation and maintenance totals $ 9,000 each year. If the company expects its capital to earn 12% before income taxes, is the investment worthwhile? Determine by usinga.) Rate of Return Method; b.) Annual Worth Method c.) Present Worth Method
J A machine costs $600,000 and is expected to yield an after-tax net income of $23,000 each year. Management predicts this machine has a 12-year service life and a $120,000 salvage value, and it uses straight-line depreciation. Compute this machine's accounting rate of return. Choose Numerator: Annual average investment ***********y 22.000 1 1 Accounts receivable Annual after-tax net income Annual average investment Annual pre-tax income Average total assets Accounting Rate of Return Choose Denominator: $ =
Baird Rentals can purchase a van that costs $110,000; it has an expected useful life of five years and no salvage value. Baird uses straight-line depreciation. Expected revenue is $40,425 per year. Assume that depreciation is the only expense associated with this Investment. Required a. Determine the payback period. Note: Round your answer to 1 decimal place. b. Determine the unadjusted rate of return based on the average cost of the investment. Note: Round your answer to 1 decimal place. (l.e., .234 should be entered as 23.4). a. Payback period b. Unadjusted rate of return years %

SEE MORE QUESTIONS

Recommended textbooks for you

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

SEE MORE TEXTBOOKS

Splish Brothers Company had an investment that cost $400,000 and had a salvage value at the end of its useful life of zero. If Mussina's expected annual net income is $15,000, the annual rate of return is: a. 3.75% b. 7.50% c. 10.13% d. 9.38%