User Account

All Pages

Compute the Accounting Rate of Return

Assignment Help Accounting Basics
Reference no: EM132719225

Problem - Able Company's management is considering the purchase of a new machine at a cost of $165,000. The machine has a 5 year life expectancy and will generate additional cash flows of $75,000 per year and additional expenses (other than depreciation) of $25,000 per year (all cash). Depreciation will use the straight line method.

Required -

1. Compute the Payback period.

2. Compute the Accounting Rate of Return.

3. Compute the Net Present Value.

4. Re-compute the Payback period only if we assume that both revenues and cash expenses increase by 10% each year.

Reference no: EM132719225

Questions Cloud

Organization program user interface : You and your team are now working on some icons for the organization's program user interface (UI).
Compute camco taxable income for its second year : In its first year, Camco Inc. generated a $103,000 net operating loss, and it made a $6,100 cash donation to a local charity. In its second year.
Find what jupiter cost of direct materials used during year : Beginning inventory$72,000. What is Jupiter's cost of direct materials used during the year? Ending work in process inventory 20,000
Project team and stakeholder management : How will project communications and interactions work between the project manager, the stakeholders and the project team?
Compute the Accounting Rate of Return : Able Company's management is considering the purchase of a new machine at a cost of $165,000. Compute the Accounting Rate of Return
Prepare a schedule that shows annual depreciation expense : Prepare a schedule that shows annual depreciation expense for the first two years, assuming the following (Round your answer to nearest whole dollar.)
Determine amount of basic earnings per share for the year : Besides, Manila Co. has 4,000, 10% convertible bonds with 1,000 face amount. Determine the amount of basic earnings per share for the year
How much cash should be distributed to peterson : In liquidation, balances prior to the distribution of cash to the partners are: Cash $800,000; Peterson, Capital $370,000; Laney, Capital $340,000.
What aspects have worked well to enhance learning : What aspects have worked well (or not) to enhance your learning? What are some recommendations you would suggest in order to improve

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare a Shareholders Equity section of the BillyBOB Corp

Prepare a Shareholders' Equity section of the Billy BOB Corporation at March 31, 2018, assuming the net income for January, February, and March is $82,000

  College calendars imprints calendars with college names the

college calendars imprints calendars with college names. the company has fixed expenses of 1115000 each month plus

  Computing joint costs-sales value at split-off

D.L. Manufacturing Inc.'s joint cost of producing 1,000 units of Product A, 500 units of Product B, and 500 units of Product C is $20,000. The unit sales values of the three products at the split-off point are Product A-$20, Product B-$200, and Pr..

  Compute the total direct materials cost variance

Ransom Inc. manufactures Product X. Compute the following for Ransom (number and term): Total direct materials cost variance

  The outstanding common stock of saul company

Paul Company acquired 100% of the outstanding common stock of Saul Company on June 30, 2012 for $473,000. On the acquisition date, Saul Company had retained earnings in the amount of $60,000, and the fair value of its recorded assets and liabiliti..

  Prepare the stockholder equity portion of the balance sheet

Using the data provided, create the owner's equity accounts and Prepare the Stockholder's Equity Portion of the Balance Sheet on January 1, 2012

  Prepare a schedule of variable and total manufacturing costs

Prepare a schedule of variable, fixed, and total manufacturing costs for each account category in 2015. Estimate total manufacturing costs for 2015.

  Determining the decision trees

Keystone Manufacturing, Inc., is analyzing a new bid to supply the compa- ny with electronic control systems. Alpha Corporation has been supplying the systems, and Keystone is satisfied with its performance. However, a bid has just been received f..

  What is the highest effective rate attainable

What is the highest effective rate attainable with a 12 percent nominal ?rate? Explain in detail and give the specific calculation, give the example.

  Calculations of merchandising accounts

Calculations of Merchandising Accounts. Based on the following, calculate net sales: 99 Sales Discount $15 Purchases $

  How purpose and principle of internal controls are different

Cash presents special internal control challenges. How do internal controls for cash differ for accounting systems reporting under IFRS versus U.S. GAAP?

  What type of products or services provided by organization

What are the type of products or services provided by the organization? Select one of four basic financial statements that you feel this organization would typically use and share the most valuable information learned from the financial statement.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd