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The chief operating officer of the Accustart Corporation is considering the effect of depreciation on the company's ROI. In the most recent year, net
The chief operating officer of the Accustart Corporation is considering the effect of depreciation on the company's ROI. In the most recent year, net operating profit after taxes was $37,800,000 and Investment (total assets of $496,800,000 less noninterest-bearing current liabilities of $21,600,000) was $475,200,000. (a) Assuming that total assets will decline each year by 4 percent due to depreciation of plant and equipment but NOPAT will remain constant, calculate ROI for each of the next 5 years. (Round answers to 2 decimal places, eg. 15.25%) ROI Year 1 Year 2 Year 3 7.95 % % Year 4
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