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Smoke Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in
Smoke Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income after tax of $100,000. The equipment will have an initial cost of $400,000 and have a 7 year life. if the salvage value of the equipment is estimated to be $75,000, what is the accounting rate of return? 147.37% 42.11% 14 28% 25.BOX Question 47 3 pts Rly Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $100,000. The equipment will have an initial cost of $400,000 and have a 5 year life. If the salvage value of the equipment is estimated to be $75,000, what is the payback period? Ignore income taxes. 4.00 Yes 7.00 years 3.25 years 4.75 years
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