UCW Inc. delivers groceries for seniors. The company is considering purchasing a new van for $50,000. The van is expected to last 7 years and have a salvage value of $8,000. UCW will use the straight-line depreciation method. UCW estimates the van will generate revenue of $25,000 per year, and incur expenses of $13,000 plus depreciation. UCW's cost of capital is 6%. Instructions For the new van, calculate the: a) cash payback period. b) net present value. c) annual rate of return. 

Answer rating: 100% (QA)

ANSWER To calculate the cash payback period net present value NPV and annual rate of return ARR for the new van purchase well follow these steps a Cas... View the full answer