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lidiya [134]
2 years ago
12

Rico Petricelli Industries invests $960,000 in plant assets with an estimated 10-year service life and no salvage value. These a

ssets contribute $64,000 to annual net income when depreciation is computed on a straight-line basis. Compute the payback period and explain your computation.
Business
1 answer:
Nesterboy [21]2 years ago
5 0

The payback period for this Rico Petricelli Industries' investment is 6 years.

Data and Calculations:

Cost of investment in plant assets =$960,000

Estimated useful life = 10 years

Estimated salvage value = $0

Annual depreciation = $96,000 ($960,000/10)

Annual net income = $64,000

Annual cash net inflow = $160,000 ($64,000 + $96,000)

Payback period = 6 years ($960,000/$160,000)

Thus, to compute the payback period as 6 years, add the annual depreciation to the annual net income to obtain the annual cash net inflow.  Then divide the cash outlay ($960,000) by the product above.

Learn more: brainly.com/question/17109529

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Growler Commercial Cleaning Company collects $1,000 deposit associated with the rental of industrialcleaning equipment. The depo
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Explanation:

The refundable deposit of $1,000 was a liability because Growler owed it to the customer and were simply holding it for when the customer returned the equipment.

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3 years ago
Nielson Motors sold 10 million shares of stock in an SEO. The market price of Nielson's stock at the time was $37.50. Of the 10
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Answer:

a. $144 million

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5 0
3 years ago
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How many years are required for an investment to double in value if it is appreciating at the rate of 9​% compounded​ continuous
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Answer:

time required is 7.70 years

Explanation:

given data

interest rate = 9%

solution

we know with the compounded​ continuously rate r and time t amount is

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and we have given amount is double so

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so from equation 1 put the value and we get here

2 A(o) = A(o) e^{rt}

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solve it we get time

time t = 7.70 years

so time required is 7.70 years

7 0
3 years ago
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