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The new hoist be used to replace murriers and tires on aut Legend estimate the new hoist will enable his to replace 5 extra mufflers per week. Each muffler sells for $74 installed. The cost of a muffler is $36, and the labor cost to install: muffler is $13. (a) Compute the cash payback period for the new hoist. Cash payback period (b) 3.38 Annual rate of return years Compute the annual rate of return for the new hoist. (Round answer to 2 decimal places, e.g. 10.52%.) 16.82 %

The new hoist be used to replace murriers and tires on aut Legend estimate the new hoist will enable his to replace 5 extra mufflers per week. Each muffler sells for $74 installed. The cost of a muffler is $36, and the labor cost to install: muffler is $13. (a) Compute the cash payback period for the new hoist. Cash payback period (b) 3.38 Annual rate of return years Compute the annual rate of return for the new hoist. (Round answer to 2 decimal places, e.g. 10.52%.) 16.82 %

Essentials Of Investments
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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Legend Service Center just purchased an automobile hoist for $27,400. The hoist has an 8-year life and an estimated salvage value of $3,700. Installation costs and freight charges were $4,300 and $800, respectively. Legend uses straight-line depreciation. * Your answer is incorrect. The new hoist will be used to replace mufflers and tires on automobiles. Legend estimates that the new hoist will enable his mechanics to replace 5 extra mufflers per week. Each muffler sells for $74 installed. The cost of a muffler is $36, and the labor cost to install a muffler is $13. (a) Compute the cash payback period for the new hoist. Cash payback period (b) 3.38 Annual rate of return years Compute the annual rate of return for the new hoist. (Round answer to 2 decimal places, e.g. 10.52%.) 16.82 %
Transcribed Image Text:Legend Service Center just purchased an automobile hoist for $27,400. The hoist has an 8-year life and an estimated salvage value of $3,700. Installation costs and freight charges were $4,300 and $800, respectively. Legend uses straight-line depreciation. * Your answer is incorrect. The new hoist will be used to replace mufflers and tires on automobiles. Legend estimates that the new hoist will enable his mechanics to replace 5 extra mufflers per week. Each muffler sells for $74 installed. The cost of a muffler is $36, and the labor cost to install a muffler is $13. (a) Compute the cash payback period for the new hoist. Cash payback period (b) 3.38 Annual rate of return years Compute the annual rate of return for the new hoist. (Round answer to 2 decimal places, e.g. 10.52%.) 16.82 %
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