Concept Introduction:
Payback Period: Payback period is the period in which the project recovers its initial cost of the investment. It can be calculated by dividing the initial investment by the annual
Requirement-a:
To Calculate:
The Return on investment for the project
Concept Introduction:
Return on Investment (ROI): The return on investment is a profitability ratio that measures the percentage of profit earned on the investment made. It is calculated with the help of following formula:
Payback Period: Payback period is the period in which the project recovers its initial cost of the investment. It can be calculated by dividing the initial investment by the annual cash inflow from the project. The formula to calculate the Payback period is as follows:
Requirement-b:
To Indicate:
The importance of Payback period for the decision making
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Chapter 16 Solutions
Accounting: What the Numbers Mean
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- Solve this financial accounting problemarrow_forwardDirect materials and labor?arrow_forwardMoti Bakery produces various baked goods. Utility costs are allocated to the products based on the baking time required for each product. Total utility costs of $270,000 are budgeted in a period when 540,000 total minutes of baking time are anticipated. If a batch of bagels bakes for 25 minutes, what amount of utility cost will be allocated to the bagels?arrow_forward
- Nantaro's customer support department follows up on customer inquiries by telephone calls. During a recent period, the department initiated 18,000 calls and incurred total costs of $420,000. Of these calls, 2,200 were for the corporate clients division, while the remainder was for the individual clients division. What are the costs allocated to the corporate clients division?arrow_forward4 PTSarrow_forwardSoove these accounts qn fastlyarrow_forward
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