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Alla [95]
3 years ago
8

"Addison Corp. is considering the purchase of a new piece of equipment. The equipment will have an initial cost of $522,000, a 3

year life, and no salvage value. If the accounting rate of return for the project is 6%, what is the annual increase in net cash flow
Business
1 answer:
Vlad [161]3 years ago
4 0

Answer:

$31,320.00

Explanation:

The formula for accounting rate of return is the annual net cash flow divided by the initial investment.

If the initial investment was $522,000 and the accounting rate of return is computed to be 6% per year, hence the annual increase in cash flow accruing from the investment can be calculated by changing the subject of the formula.

ARR=annual increase in cash flow/initial investment

ARR is 6%

initial investment is $522,000

annual increase in cash flow?

6%=annual increase in cash flow/$522,000

annual increase in cash flow=6%*$522,000= $31,320.00  

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Higher interest rates result in less borrowing as ________ business projects become viable for a profit.
Elan Coil [88]
Would loans be a answer?
4 0
3 years ago
Adams Co. reports the following balance sheet accounts as of December 31. Salaries payable $ 6,800 Retained earnings $ 58,000 Bu
krek1111 [17]

Answer:

                                     Adams Co.

                        Balance Sheet as of December 31.

Assets

<u>Current Assets</u>

Cash                               $32,000  

Accounts Receivable $12,000  

Merchandise Inventory $15,600  

Office Supplies              $3,600  

Prepaid Rent                  $7,800

Prepaid Insurance          $4,600  

Total Current Assets                                         $ 75,600

<u>Property, Plant and Equipment</u>

Land                                                                    $38,000

Building                                 $67,800

Accumulated Depreciation $(6,600)                <u>$61,200</u>

(Buildings)  

Total Assets                                                        <u>$ 174,800</u>

<u></u>

Liabilities

<u>Current Liabilities</u>

Accounts Payables                $18,000

Salaries Payable                    <u>$6,800 </u>

Total Current Liabilities                               $24,800

<u>Long term Liabilities </u>

Notes Payable                                                      $46,000

Mortgage Payable                                               $28,000

Total Long term Liabilities                                  $74,000

Total Liabilities                                                     $98,800

<u>Stockholder's Equity</u>  

Common Stock                       $18,000

Retained Earnings                  $58,000

Total Stockholder's Equity                                 <u>$76,000</u>

Total Liabilities & Stockholder's Equity           <u>$174,800</u>

4 0
2 years ago
All of the following individuals are U.S. residents: Kelly (27), her daughter Sydnee (4), and Kelly's mother, June (50). All thr
m_a_m_a [10]
The person with a stable household
5 0
3 years ago
Read the scenario and answer the question.
Aleksandr-060686 [28]

Answer:

A). The price of gasoline increased in coastal cities since gasoline was harder to find.

Explanation:

As per the principles of demand and supply, a decrease in supply while demand remains constant will cause the price to increase.  In Georgia, the supply of gasoline was interrupted by the storm's effect. There was little gasoline coming in, leading to a shortage. After Electricity went off, gasoline demand must have gone high as people needed fuel for generators.

Gasoline has no close substitutes, especially when used as fuel for cars and generators. A shortage results in the scramble for the little available products. Sellers hike prices to maximize profits, and buyers are willing to pay more to get the scarce gasoline, thereby increasing its prices.

6 0
3 years ago
For 2021, Rahal's Auto Parts estimates bad debt expense at 1% of credit sales. The company reported accounts receivable and an a
ziro4ka [17]

Answer:

$3,860

Explanation:

The balance in the account Allowance for Doubtful Accounts is expected to be the projected amount in receivables of the company that will not be converting to cash.

Therefore to calculate final balance of allowance for doubtful balance

Beginning balance                                                                 2700

Bad debt expense (410000*1%)                                            4100

Less: Written off                                                                   -2940

Ending balance                                                                    3860

So answer is $3,860

4 0
3 years ago
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