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Fanning Rentals can purchase a van that costs $125,000; it has an expected useful life of five years and no salvage value. Fanning uses straight-line
Fanning Rentals can purchase a van that costs $125,000; it has an expected useful life of five years and no salvage value. Fanning uses straight-line depreciation. Expected revenue is $46,125 per year. Assume that depreciation is the only expense associated with this investment. Required a. Determine the payback period. (Round your answer to 1 decimal place.) b. Determine the unadjusted rate of return based on the average cost of the investment. (Round your answer to 1 decimal place. (.e., .234 should be entered as 23.4).) years a. Payback period b. Unadjusted rate of return %
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