22-7Payback period, accounting rate of return on investment Al-Baida wants to buy a new machine with special purposes for an amount (1)One million $ Dollars for the production of a product, and the...

None22-7Payback period, accounting rate of return on investment Al-Baida wants to<br>buy a new machine with special purposes for an amount<br>(1)One million $ Dollars for the production of a product, and the economic life<br>of the machine is (10) years, bearing in mind that there is no residual value for<br>the machine at the end of its useful life. The company adopts the straight-line<br>method in calculating the depreciation, and it is expected that the annual revenues<br>from operating the machine will be 1,200,000 $ Dollars, and the annual expenses<br>excluding taxes, 700,000 $ Dollars. If you know that the company adopts a<br>discount rate of 12%. The income tax rate is 30% for all years .<br>Required: Calculate the following:<br>1. The payback period.<br>2. The rate of accounting return on investment.<br>

Extracted text: 22-7Payback period, accounting rate of return on investment Al-Baida wants to buy a new machine with special purposes for an amount (1)One million $ Dollars for the production of a product, and the economic life of the machine is (10) years, bearing in mind that there is no residual value for the machine at the end of its useful life. The company adopts the straight-line method in calculating the depreciation, and it is expected that the annual revenues from operating the machine will be 1,200,000 $ Dollars, and the annual expenses excluding taxes, 700,000 $ Dollars. If you know that the company adopts a discount rate of 12%. The income tax rate is 30% for all years . Required: Calculate the following: 1. The payback period. 2. The rate of accounting return on investment.

Jun 08, 2022
SOLUTION.PDF

Get Answer To This Question

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here