Solve the payback period in years

Assignment Help Managerial Accounting
Reference no: EM132516714

Crown Royal Hospital is thinking of upgrading their MRI machine rather than do the scheduled major overhaul. New ceramic magnets use far less energy and require less annual maintenance. Since the specialized, shielded room has already been built, Crown Royal only has to look at the cost of the machine and not of any renovations. A new MRI will cost $3,190,000. Annual savings in electricity and maintenance are estimated at $290,000 per year. The new machine is expected to have a twelve-year life before a major overhaul is required.

Question 1: Calculate the payback period in years (to the nearest two decimal places). Show all work. Advise the hospital if this is a good idea.

Payback period = Amount invested / Expected annual net cash flow Calculate the annual Accounting Rate of Return (to the nearest two decimal places). Show all work. Accounting rate of return = Average annual savings (or revenue increase) / Total Amount invested

Reference no: EM132516714

Questions Cloud

What is nothing outside the mind philosophy about : What is nothing outside the mind Philosophy about?
How the cost of such an asset may be considered irrelevant : However, the cost of such an asset may be considered irrelevant in most internal decision-making. Explain how and why this might be true
How would you introduce the given topic to the family : You are conducting a family session and you have determined that the whole family would benefit from attending 12-step meetings. How would you introduce this.
Compute the return on investment for each division : The income from operations and the amount of invested assets in each division of Beck Industries - Compute the return on investment for each division
Solve the payback period in years : Calculate the payback period in years (to the nearest two decimal places). Show all work. Advise the hospital if this is a good idea.
Describe the concept of god in the 12-steps : You have a client that is refusing to attend AA meetings in the community. He reports that he does like the concept of God in the 12-steps and that the meetings
CPCCBC4008B Conduct onsite supervision of building : CPCCBC4008B Conduct onsite supervision of building and construction projects Assignment Help and Solution, Unity School of Education - Assessment Writing
Determine how a firms break-even-point is affected : Assuming that all other factors remain unchanged, determine how a firm's break-even-point is affected. The firm finds it necessary to reduce the price unit
Project management certification exam : you will take on the role of a Project Management Institute (PMI) Project Management Certification exam instructor and complete a PowerPoint presentation

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Compute allocated production support cost

Prepare a schedule that shows the gross margin for both products and identify the formula labels, then compute the allocated production support cost.

  Compute the cost per cost driver

Compute the cost per cost driver for each of the three cost centers and use the results from part 1 to allocate costs from each of the three cost centers to both financial planning and tax preparation.

  Prepare a schedule showing a vertical analysis for 2017

Operating data for Poll Corporation are presented Prepare a schedule showing a vertical analysis for 2017 and 2016

  What is the weighted average cost of capital

What is the weighted average cost of capital and What is the salvage cash flow of the new equipment? Include the income tax effect

  Calculate the net annual cost of lighting

Question: Please calculate the net annual cost of lighting. (Show your work)

  Pak company manufactures and sells mountain bikes

PAK Company manufactures and sells mountain bikes. It normally operates eight hours a day, five days a week.

  Compute the unadjusted cost of goods sold

Compute the cost of Ending Work-in-Process Inventory (use applied overhead - not actual overhead). Compute the (unadjusted) Cost of Goods Sold.

  That distinguish financial management in firms

Identify the principal factors (at least five), with explanations, that distinguish financial management in firms operating entirely in a single country from those that operate globally.

  Net present value cma adapted lo 3 maybe i should have

net present value cma adapted lo 3 maybe i should have stuck with teaching high school art. no matter what i try i cant

  Review the discussion of the importance

Piaggio, Polaris, and Arctic Cat are competitors in the global marketplace. Selected data for Piaggio follow.

  Calculate the price per hour that labortechs will charge

Provide a succinct statement (at least one sentence but no more than one paragraph) comparing the advantages of the cost-plus pricing

  Compute contribution margin per unit using sales price

Compute contribution margin per unit using sales price per unit and variable cost per unit calculated. (Round to 4 decimal places)

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