Question: can I get help computing the net book value? The Ste Marie Division of Pacific Media Corporation just started operations. It purchased depreciable assets costing
The Ste Marie Division of Pacific Media Corporation just started operations. It purchased depreciable assets costing $45 million and having a four-year expected life, after which the assets can be salvaged for $9 million. In addition, the division has $45 million in assets that are not depreciable. After four years, the division will have $45 million available from these nondepreciable assets. This means that the division has invested $90 million in assets with a salvage value of $54 million Annual depreciation is $9 million Annual operating cash flows are $20 million Depreciation is computed on a straight-line basis, recognizing the salvage values noted. Ignore taxes. Assume that the division uses beginning of year asset values in the denominator for computing ROL Required: a. & b. Compute ROI, using net book value and gross book value. (Enter your answers as a percentage roundef to 1 decimal place (l... 32.1).) Answer is complete but not entirely correct. Year 1 Year 2 Year 3 Year 4 Net Book Value 13.6 % 15 3 X % 17.5 % % 20.4 % ROI Gross Book Value 12.2% 122 % 12.2% 122
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