You are considering a large CNC equipment purchase. You will need an initial deposit of $165,000. The annual revenues expected to come from the use of the CNC equipment are $85,000 starting in year 1 increasing by $4,000 each year (i.e. $85,000 in year 1, $89,000 in year 2, etc.). Annual operating and maintenance costs are expected to be $35,000 every year starting in year 1. The equipment is expected to last for 15 years. What is the ROR? Question 6 Part C: Provide the ROR for the purchase. Enter your answer in the form 12.34 (for example, 12.34% would be entered as 12.34)

You are considering a large CNC equipment purchase. You will need an initial deposit of $165,000. The annual revenues expected to come from the use of the CNC equipment are $85,000 starting in year 1 increasing by $4,000 each year (i.e. $85,000 in year 1, $89,000 in year 2, etc.). Annual operating and maintenance costs are expected to be $35,000 every year starting in year 1. The equipment is expected to last for 15 years. What is the ROR? Question 6 Part C: Provide the ROR for the purchase. Enter your answer in the form 12.34 (for example, 12.34% would be entered as 12.34)

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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Question

You are considering a large CNC equipment purchase. You will need an initial deposit of $165,000. The annual revenues expected to
come from the use of the CNC equipment are $85,000 starting in year 1 increasing by $4000 each year (i.e. $85,000 in year 1,
$89,000 in year 2, etc.). Annual operating and maintenance costs are expected to be $35,000 every year starting in year 1. The
equipment is expected to last for 15 years. What is the ROR?
Question 6 Part C: Provide the ROR for the purchase. Enter your answer in the form 12.34 (for example, 12.34% would be entered
as 12.34)

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