A fixed capital investment of ₱10,000,000 is required for a proposed manufacturing plant and an estimated working capital of ₱2,000,000. Annual depreciation is estimated to be 10% of the fixed capital...

A fixed capital investment of ₱10,000,000 is required for a proposed manufacturing plant and an estimated working capital of ₱2,000,000. Annual depreciation is estimated to be 10% of the fixed capital investment. Determine the rate of return on the total investment and the payout period if the annual profit is ₱2,500,000.

Ans: 12.50%, 4.8 years