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Umnica [9.8K]
3 years ago
6

An equipment costing $60,000 is being evaluated for a production process at Don Jones Co. The expected benefits per year is $4,5

00 and estimated salvage value is $20,000. Determine the rate of return the company can get in this equipment proposal. Equipment life
Business
1 answer:
Vera_Pavlovna [14]3 years ago
5 0

Answer:

Rate of return= 11.25%

Explanation:

<em>The accounting rate of return is the average annual income expressed as a percentage of the average investment.  </em>

<em>The simple rate of return can be calculated using the two formula below:  </em>

<em>Accounting rate of return  </em>

= Annual operating income/Average investment × 100  

Average investment = (Initial cost + scrap value)/2  

Average annual income = Total income over investment period / Number of years

Average investment = (60,000 + 20,000)/2= $40,000

Average annual income is already given as  = 4,500

Rate of return = 4500/40,0000 × 100 = 50%

Rate of return= 11.25%

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rewona [7]

Answer:

$3,425

Explanation:

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7 0
2 years ago
Match the following functions with their descriptions.
drek231 [11]

Answer:

A. ERP

B. RFID

C. Barcodes

D. E-business

E. EDI

Explanation:

Here is the complete question :

Match the following functions with their descriptions.

(E-Business, EDI, Bar Codes, ERP, RFID)

A. It allows companies to organize and share information

B. It provides instantaneous tracking by containing identifying information

C. It provides complete visibility of product location

D. Provides access to global markets, suppliers and distribution channels

E. It enables exchange of documents in a standard format

Enterprise resource planning (ERP) is a software used to organise a business core processes

Electronic Data Interchange (EDI) is used to exchange business documents in a standardised format electronically

Types of EDI

  1. Direct EDI
  2. EDI via value added networks (VANs)
  3. Web EDI
  4. Mobile EDI

Advantages of EDI

  1. It increases business efficiency
  2. It reduces operating costs

Disadvantages of EDI

  1. Initial setup cost is usually quite high

Radio-frequency identification (RFID) is used to identify and track tags that are attached to items

Barcodes are used as a means of identification of a product. They can identify the country a product is manufactured.

Electronic business (E-business) has accelerated the rate of global integration. It has increased the access to global markets, suppliers and distribution channels.

6 0
2 years ago
How do I make ice cream
dedylja [7]
Stir sugar, cream and milk into a sauce pan over low heat until sugar has dissolved  Heat just until mix is hot and a small ring of foam appears around the edge. 2. Transfer cream mixture into a pour able container such as a large measuring cup. Stir in vanilla extract and chill mix thoroughly, at least two hours. 3. pour cold ice cream mix into an ice cream container, turn on the machine, and churn according to the manufacturers directions.  20 to 25 min. 4. When ice cream is softly frozen, swerve immediately or place a plastic wrap  directly on the ice cream and place in freezer to ripen, 2 to 3 hrs <span />
8 0
3 years ago
Read 2 more answers
Margarite's Enterprises is considering a new project that will require $345,000 for new fixed assets, $160,000 for inventory, an
atroni [7]

Answer:

NPV = (53,222.44)

Explanation:

Net fixed asset                              345,000

Working capital

160,000 inventory + 35,000 Ar =   195,000

short term deb                                 (110,000)

net working capital                           85,000

Total investment                            430,000

salvage value 345,00 x 25% = 86,250

release of the working capital  85,000

Cash flow at end of project      171,250

annual cash flow

sales             550,000

cost              (430,000)

depreciation    69,000

EBT                   51,000

tax expense 35%

                        (17,850)

net income       33,150

+ dep                 69,000

cash flow           102,150

Now we calculate the present value of the net cash flow and the present alue fothe end of the project

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 102150

time 4

rate 0.15

102150 \times \frac{1-(1+0.15)^{-4} }{0.15} = PV\\

PV $291,636.04

\frac{Principal}{(1 + rate)^{time} } = PV  

Principla (sum of salvage and released Working capital   171,250.00

time   5.00

rate   0.15

\frac{171250}{(1 + 0.15)^{5} } = PV  

PV   85,141.52

NPV = 291,636.04 + 85,141.52 - 430,000 = (53,222.44)

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3 years ago
Where subjective measures of performance are necessary, companies should rely on multiple sources of information?
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