Annual rate of return and payback period for the equipment

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Reference no: EM131893260

Blue Marlin Company is considering the purchase of new equipment for its factory. It will cost $255,000 and have a $51,000 salvage value in five years. The annual net income from the equipment is expected to be $28,050, and depreciation is $40,800 per year.

Calculate Blue Marlin’s annual rate of return and payback period for the equipment. (Do not round intermediate calculations. Round your Payback Period to 2 decimal places.)

Reference no: EM131893260

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