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A company is planning to purchase a machine that will cost $35,400, will have a six-year life, and will have no salvage value. The company
A company is planning to purchase a machine that will cost $35,400, will have a six-year life, and will have no salvage value. The company expects to sell the machine's output of 3,000 units evenly throughout each year. A projected Income statement for each year of the asset's life appears below. What is the accounting rate of return for this machine? Sales $ 106, 000 Costs: Manufacturing $ 51, 300 Depreciation on machine 5,900 Selling and administrative expenses 46, 000 (103, 200) Income $ 2,800 Multiple Choice O 15.82% O 5.90%. O 33.33%. O 5.14%. O 50.00%
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