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Copr., Goedl GreenWay is considering investing in a new machine to provide a new residential...

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Accounting

Copr., Goedl GreenWay is considering investing in a new machine to provide a new residential cleaning service. The machine costs $300,000. The machine has a useful life of 13 years and the annual depreciation expense would be $20,700. They estimate they can generate $93,300 in annual revenue from the new service. Cash operating expenses are estimated to be $42,000 per year. The machine has an approximate salvage value of $30,000 at the end of its useful life. The company has a 10% minimum rate of return.
The payback period for this investment is:
8.82 years
5.85 years
5.26 years
9.80 years
Question 10
1pts
Copr., Goedl GreenWay is considering investing in a new machine to provide a new residential cleaning service. The machine costs $300,000. The machine has a useful life of 13 years, and the annual depreciation expense would be $20,700. They estimate they can generate $93,300 in annual revenue Irom the new service. Cash operating expenses are estimated to be $42,000 per year. The machine has an approximate salvage value of $30,000 at the end of its useful life. The company has a 10% minimum rate of return.
The simple rate of return for this investment is:
17.1%
10.2%
11.3%
19.0%
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