Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Transport Ltd is considering fitting a mounted forklift to each of its five delivery trucks. They have decided to base their decision on the accounting

Transport Ltd is considering fitting a mounted forklift to each of its five delivery trucks. They have decided to base their decision on the accounting rate of return and provide you with the following information:

The cost of the mounted forklifts will be €95,000 and they are expected to have a five year life with a scrap value of €5,000. The purchase of the forklifts is expected to result in a

€10,000 cash inflow in the first year and cash inflows of €40,000, €40,000, €60,000 and

€45,000 in years two to five respectively. Determine the forklifts accounting rate of return.

Step by Step Solution

3.47 Rating (147 Votes )

There are 3 Steps involved in it

Step: 1

Depriciation per year 2 3 u S Calculation de Net Profit year cash inflows 4 10000 40000 4... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: James D. Stice, Earl K. Stice, Fred Skousen

17th Edition

032459237X, 978-0324592375

More Books

Students also viewed these Accounting questions

Question

How many points can we have in a DHT with m = 10?

Answered: 1 week ago

Question

Brief the importance of span of control and its concepts.

Answered: 1 week ago

Question

What is meant by decentralisation?

Answered: 1 week ago

Question

Write down the Limitation of Beer - Lamberts law?

Answered: 1 week ago

Question

Discuss the Hawthorne experiments in detail

Answered: 1 week ago

Question

What is the historical significance of par value?

Answered: 1 week ago