Question
Helicopter Gear is planning to expand its product line, which requires an investment of $477,600 in special-purpose machinery. The machinery has a useful life of
Helicopter Gear is planning to expand its product line, which requires an investment of $477,600 in special-purpose machinery. The machinery has a useful life of six years and no salvage value. The estimated annual results of offering new products produced from the new investment are as follows: Revenue $528,000 Expenses (including straight-line depreciation) ($501,500) Increase in net income from investment $ 26,500 a. The return on average investment for this proposed investment is % (round to the whole percentage 10.4% = 10%, 10.5% = 11%, etc.) b. The payback for this investment would be years (Round to whole and tenth of the year. For example, 5.63 years = 5.6 years)
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