Answered

Discover answers to your most pressing questions at Westonci.ca, the ultimate Q&A platform that connects you with expert solutions. Experience the ease of finding quick and accurate answers to your questions from professionals on our platform. Experience the convenience of finding accurate answers to your questions from knowledgeable experts on our platform.

C Corporation is investigating automating a process by purchasing a machine for $803,700 that would have a 9 year useful life and no salvage value. By automating the process, the company would save $138,500 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $22,300. The annual depreciation on the new machine would be $89,300. The simple rate of return on the investment is closest to (Ignore income taxes.):

Sagot :

abiolataiwo2015

Answer:

6.30%

Explanation:

Calculation to determine what The simple rate of return on the investment is closest to

Using this formula

Simple rate of return= Annual net profit / net investment

Let plug in the formula

Simple rate of return= (138,500-89,300)/(803,700-22,300)

Simple rate of return= 49,200/781,400

Simple rate of return= 6.30%

Therefore The simple rate of return on the investment is closest to 6.30%

Thank you for visiting. Our goal is to provide the most accurate answers for all your informational needs. Come back soon. We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Thank you for using Westonci.ca. Come back for more in-depth answers to all your queries.