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Path:p Words:0 QUESTION 5 Consumption of craft beers is increasing. Three Old Guys. Incorporated (TOGI) is considering expanding the capacity of their craft brewery to
Path:p Words:0 QUESTION 5 Consumption of craft beers is increasing. Three Old Guys. Incorporated (TOGI) is considering expanding the capacity of their craft brewery to sell a new product, Old Ted Ale. A 50 hectoliter brewing system will last 7 years and will cost $315,000 and can turn out 50 hectoliters of beer (5,000 liters) each month for twelve months each year. TOGI believes sales of Old Ted will net $45,000 in contribution margin per year. Calculate the payback period (to the nearest two decimal places) in years for the new brewing system. Does it make sense for TOGI to make this investment? Show all work. Payback period = Amount invested / Expected annual net cash flow Calculate the annual Accounting Rate of Return (to the nearest two decimal places). Show all work. Accounting rate of return - Average annual savings (or revenue increase) / Total Amount invested TT T Arial 3 (12pt) T E Click Save and Submit to save and submit. Chick Save All Answers to see all anses
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