A piece of labor-saving equipment has just come onto the market that Mitsui Electronics, Limited, could...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
A piece of labor-saving equipment has just come onto the market that Mitsui Electronics, Limited, could use to reduce costs in one of its plants in Japan. Relevant data relating to the equipment follow: Purchase cost of the equipment Annual cost savings that will be provided by the equipment Life of the equipment Required: $ 412,500 $ 75,000 10 years 1a. Compute the payback period for the equipment. 1b. If the company requires a payback period of four years or less, would the equipment be purchased? 2a. Compute the simple rate of return on the equipment. Use straight-line depreciation based on the equipment's useful life. 2b. Would the equipment be purchased if the company's required rate of return is 12%? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Compute the payback period for the equipment. (Round your answer to 1 decimal place.) A piece of labor-saving equipment has just come onto the market that Mitsui Electronics, Limited, could use to reduce costs in one of its plants in Japan. Relevant data relating to the equipment follow: Purchase cost of the equipment Annual cost savings that will be provided by the equipment Life of the equipment Required: $ 412,500 $ 75,000 10 years 1a. Compute the payback period for the equipment. 1b. If the company requires a payback period of four years or less, would the equipment be purchased? 2a. Compute the simple rate of return on the equipment. Use straight-line depreciation based on the equipment's useful life. 2b. Would the equipment be purchased if the company's required rate of return is 12%? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Compute the payback period for the equipment. (Round your answer to 1 decimal place.)
Expert Answer:
Answer rating: 100% (QA)
1a Compute the payback period for the equipment Payback period Purchase cost of the equipment Annual ... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-0697789938
13th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Posted Date:
Students also viewed these accounting questions
-
Explain Organizational factors in the individual ethical behaviour. (15-20 sentences) Subject: Behavioral Finance
-
Consider the following table, which gives a security analyst's expected return on two stocks in two particular scenarios for the rate of return on the market: Market Return 5% 26 Aggressive Stock -3%...
-
Question 6 Answer any four of the following: (a) Describe Composite Cost unit as used in Service Costing and discuss the ways of computing it. (b) Journalise the following transactions in cost books...
-
The September 30, 2018, adjusted trial balance of Buzzy?s, Inc., is shown next. Requirements 1. Prepare the September closing entries for Buzzy?s, Inc. 2. Calculate the ending balance in Retained...
-
In an attempt to increase the amount of money people would receive at retirement from Social Security, the U. S. Congress during its 1999 session debated whether a portion of Social Security funds...
-
It is known that roughly 2/3 of all human beings have a dominant right foot or eye. Is there also right-sided dominance in kissing behavior? The article "Human Behavior: Adult Persistence of...
-
Prepare headings for a cash receipts journal like the one in Exhibit 7A.2. Journalize the November transactions shown in Exercise 7-4 that should be recorded in the cash receipts journal assuming...
-
On July 1, 2017, Amos Corporation granted nontransferable, nonqualified stock options to certain key employees as additional compensation. The options permit the purchase of 20,000 shares of Amos's...
-
Find the first five terms of the sequence. an = 9 + 5n a = a2 = a3 = 24 as = = Determine whether the sequence is arithmetic. If it is arithmetic, find the common difference d. (If the sequence is not...
-
Unix Op Sys I 15. What is the absolute kill signal called? Howdoes it work? 16. How many and what main types of Linux commands canbe executed?
-
Distinguish between the par value and the issue price of a bond. When are they the same? When are they different? Explain. If a \($5,000\) bond is sold for 101, how much cash is paid/received?
-
Ralph Kaye owned a small company that sold garden equipment. The equipment was expensive, and a perpetual system was maintained for control purposes. Even so, lost, damaged, and stolen merchandise...
-
Auto Shoppe is considering the purchase of a new engine computer code reader for $65,000. Auto Shoppe can charge $75 for the service of reading the codes from a single car engine, while the actual...
-
You have purchased a smart phone that has a battery system advertised as allowing 22 hours of talk time before it requires recharging. A friend of yours advises you that it is a good phone, but the...
-
A former BFA director incorporated both ALO and New Church Ventures. The entities had no employees of their own, and both organizations paid BFA substantial management fees to provide accounting,...
-
Problem 1: Crunchy sources from hundreds of suppliers. Currently, Crunchy uses full TL (Truckload) transportation to obtain separately from each supplier. Truckload shipping costs $500 per truck and...
-
Express these numbers in standard notation. a. 2.87 10-8 b. 1.78 1011 c. 1.381 10-23
-
Baseline Petroleum, a successful efforts company, entered the oil and gas business in 2014 with the acquisition of one field. Baseline proved the field during 2014. At the end of 2014, prices were...
-
The CEO of Green Oil Company, Dwight Allen, gave a speech at the World Environmental Conference. In his speech, Mr. Allen spoke about Green Oils goal of doing no damage to the environment as a result...
-
Define the following: run ticket settlement statement thief gauging strapping Define the following and explain their relevance to oil and gas revenue accounting: Henry Hub West Texas Intermediate...
Study smarter with the SolutionInn App