Chapter 11 Homework 12 10 points Skipped eBook 101 Hint Print References E11-4 (Algo) Calculating Accounting Rate of Return, Payback Perlod, Net Present Value, Estimating Internal Rate of Return [LO 11-1, 11-2, 11-3, 11-4] Linda's Luxury Travel (LLT) is considering the purchase of two Hummer limousines. Various information about the proposed investment follows: Initial investment (2 limos) Useful life Salvage value Annual net income generated LLT's cost of capital Assume straight line depreciation method is used. Required: Help LLT evaluate this project by calculating each of the following: 1. Accounting rate of return. 2. Payback period. $ 780,000 10 years $ 100,000 $ 64,740 15 3. Net present value. (Future Value of $1,Present Value of $1, Future Value Annuity of $1. Present Value Annuity of $1.) Note: Use appropriate factor(s) from the tables provided. 4. Without making any calculations, determine whether the IRR is more or less than 15%. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Calculate accounting rate of return. Note: Round your answer to 1 decimal place. Accounting Rate of Return Saved % Required 1 Required 2 >

E11-4 (Algo) Calculating Accounting Rate of Return, Payback Period, Net Present Value, Estimating Internal Rate of Return [t.O 11-1, 11-2, 11-3, 11-4] Lindas Luxury Trawet (ut) is conudeing the purchare of fwo Hunmer lenewines Various informasoo abeut the proposed avestinent follows: Assume straight lime depeciation method is used. Required Help LLT eviluate this project by cakulating eech of the folowng 1. Accounting rate of return. 2. Paybock penod Note: Use appropriate factor(s) from the lables provided. 4. Whthout mating arty calculstions, determine whethor the IRR is mose or less than 15k complete this question by enterine your answers in the tabs bolow. Caiculate eccounting rale of retum. Note: Round your enswer 1e I decimal plece. 1aDe