Answered step by step
Verified Expert Solution
Question
1 Approved Answer
NEED AN SOLUTION FOR THIS ASAP. THANKS Following data in respect of two machines namely 'A' and 'B' are detailed below Depreciation has been charged
NEED AN SOLUTION FOR THIS ASAP. THANKS
Following data in respect of two machines namely 'A' and 'B' are detailed below Depreciation has been charged on straight line basis and estimated life of both machines is five years. (In) Machine 'A 56,125 Machine 'B' 56,125 3,375 Item Cost Net income after depreciation and taxes: 1st Year 2nd Year 3rd Year 4th Year 5th Year 11,375 9,375 5,375 7,375 7,375 9,375 11,375 5,375 3,375 36,875 36,875 (a) (b) Average rate of return on 'A' and 'B' machines Which machine is better from the point of view of pay-back period and why? Calculate average rate of return when salvage value of machine 'A' turns out to be Rs. 3,000 and when 'B' machine has zero salvage value. (C)Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started