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Carla Vista Service Center just purchased an automobile hoist for $ 3 2 , 3 0 0 . The hoist has an 8 - year
Carla Vista Service Center just purchased an automobile hoist for $ The hoist has an year life and an estimated salvage value
of $ Installation costs and freight charges were $ and $ respectively. Carla Vista uses straightline depreciation.
The new hoist will be used to replace mufflers and tires on automobiles. Carla Vista estimates that the new hoist will enable its
mechanics to replace extra mufflers per week. Each muffler sells for $ installed. The cost of a muffler is $ and the labor cost to
install a muffler is $
a
Compute the cash payback period for the new hoist.
Cash payback period
years
b
Compute the annual rate of return for the new hoist. Round answer to decimal places, eg
Annual rate of return
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