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Please help asap! Average rate of return, cash payback period, net present value method for a service company The St. Louis to Seattle Railroad is
Please help asap!
Average rate of return, cash payback period, net present value method for a service company The St. Louis to Seattle Railroad is considering acquiring equipment at a cost of $216,000. The equipment has an estimated life of 10 years and no residual value. It is expected to provide yearly net cash flows of $27,000. The company's minimum desired rate of return for net present value analysis is 15%. Present Value of an Annuity of $1 at Compound Interest Compute the following: a. The average rate of return, giving effect to straight-line depreciation on the investment. If required, round your answer to one decimal place. X% b. The cash payback period. c. The net present value. Use the above table of the present value of an annuity of $1. Round to the nearest dollar. If required, use a minus sign to indicate negative net present value for current grading purpose. Present value of annual net cash flows Amount to be investedStep by Step Solution
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