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Pharmacy has purchased a small auto for delivering prescriptions. The auto was purchased for $28,000 and will have a 6-year useful life and a
Pharmacy has purchased a small auto for delivering prescriptions. The auto was purchased for $28,000 and will have a 6-year useful life and a $4,700 salvage value. Delivering prescriptions (which the pharmacy has never done before) should increase gross revenues by at least $32,700 per year. The cost of these prescriptions to the pharmacy will be about $26,400 per year, The pharmacy depreciates all assets using the straight-line method. The payback period for the auto is closest to (Ignore income taxes.): (Round your answer to 1 decimal place.) Multiple Choice O 4.4 years 4.2 years 37 years 5.2 years
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