Determine the average rate of return on the equipment

Assignment Help Accounting Basics
Reference no: EM132772294

Problem - Midwest Fabricators Inc. is considering an investment in equipment that will replace direct labor. The equipment has a cost of $132,000 with a $16,000 residual value and a 10-year life. The equipment will replace one employee who has an average wage of $34,000 per year. In addition, the equipment will have operating and energy costs of $5,380 per year.

Required - Determine the average rate of return on the equipment, giving effect to straight-line depreciation on the investment.

Reference no: EM132772294

Questions Cloud

Calculate the net present value of the new hotel : Welcome Inn Hotels is considering the construction of a new hotel for $90 million. Calculate the net present value of the new hotel
Explain the sociological effects of marijuana use : In 750-1,000 words, write a summary about your assigned position that describes its major tenets and arguments for them. Make sure to include the physiological.
Prepare the entry required for the redemption of face value : Prepare the entry required for the redemption of face value $2,840,000 of the bonds on June 1, 2021. Make year-end entry required at February 28, 2021
Big data analytics in e-healthcare industry : There are several benefits as well as challenges associated with the use of Big Data Analytics in the e-Healthcare industry
Determine the average rate of return on the equipment : The equipment will have operating and energy costs of $5,380 per year. Determine the average rate of return on the equipment
What would be the dr to stock investments for the purchase : On January 2, 2017, Prepare the General Journal so as to determine what would be the Dr to Stock Investments for the purchase?
Knowledge management cycle : We focus on the knowledge management cycle noted in Figure 5.3 in the Information Technology and Organizational Learning text.
What surprised you about some of history of human services : Describe what you learned and what surprised you about some of the history of Human Services and legislation which has impacted it through the years.
Calculate the net present value of the investment : AM Express Inc. is considering the purchase of an additional delivery vehicle for $55,000 on January 1, 20Y1. Calculate the net present value of the investment

Reviews

Write a Review

Accounting Basics Questions & Answers

  If 45000 units have been transferred out 60000 units were

if 45000 units have been transferred out 60000 units were started this period and there were 15000 units in beginning

  Problem related to process costing system

Write a brief summary (one paragraph) for each of the three companies that include the name, web site address, and a brief description of its business. Secondly, please discuss the reasons why the company would most likely use a process costing sy..

  Calculate the total manufacturing costs and the cost per

medtech inc. manufactures and sells diagnostic equipment used in the medical profession. its job costing system was

  What is a non-GAAP financial measure

What is a non-GAAP financial measure? Give an example of at least one non-GAAP financial measure and how it is calculated and how it is used

  What account titles might you find on a balance sheet

King of Jeans If you have bought a pair of jeans at American Eagle (AE), you're not alone. American Eagle sells the most jeans of any U.S. specialty store.

  How much was each semi-annual withdrawal

After the last withdrawal at the end of year 22, there is $5,000 remaining in the account. How much was each semi-annual withdrawal in year 19 through 22?

  What the aged-payables & aged-receivables reports are

Include the required items that are needed and other items that you think of that would be helpful in properly adding vendors & customers

  Would recommend mxm to build the plant and explain why

The building is estimated to have a useful life of 10 years, Compute the net present value for this investment. Would you recommend MXM to build the plant?

  Create the trial balance in the normal structure

Using EXCEL, create the trial balance in the normal structure (current assets, long term assets, current liabilities, etc.). Also, include in the workbook a Cost of Goods Manufactured Statement, an Income Statement, a Retained Earnings Statement, and..

  Determine what minimum taxable capital gain to be reported

Balance to be paid in equal annual instalments over the following five years. What is the minimum taxable capital gain to be reported in Year 2?

  What is the effect on income before taxes

ACCT221 - Intermediate Accounting Assignment - What is the effect on income before taxes of the change requested by the controller

  Prepare the required journal entries for Coronado Co

Coronado Co. uses the gross method to record sales made on credit. Prepare the required journal entries for Coronado Co

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!

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