Question: Explain how you solved please !!! Cleaners, Inc. is considering purchasing equipment costing $60000 with a 6-year useful life. The equipment will provide annual cost

Explain how you solved please !!!

Cleaners, Inc. is considering purchasing equipment costing $60000 with a 6-year useful life. The equipment will provide annual cost savings of $14600 and will be depreciated straight-line over its useful life with no salvage value. Cleaners requires a 10% rate of return. What is the approximate internal rate of return for this investment? 12% 9% 10% 11%

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Skysong, Inc. is considering purchasing equipment costing $38000with a 6-year useful life. The equipment will provide annual cost savings of $9243and will be depreciated straight-line over its useful...

1) Johnson Corp. has an 8% required rate of return. It's considering a project that would provide annual cost savings of $50,000 for 5 years. The most that Johnson would be willing to spend on this...

True / False Questions: 1. For purposes of capital budgeting, estimated cash inflows and outflows are preferred for inputs into the capital budgeting decision tools True False 2. The net present...

Cleaners, Inc. is considering purchasing equipment costing $60000 with a 6-year useful life. The equipment will provide annual cost savings of $14600 and will be depreciated straight-line over its...

Question 1: Cleaners, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over...

8. At 18,000 direct labor hours, the flexible budget for indirect materials is $36,000.1f $37,400 are incurred at 18,400 direct labor hours, the flexible budget report should show the following...

What is the Cleaners, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over...

Cleaners, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful...

Use the following information for the questions below. Cleaners, Inc. is considering purchasing equipment costing $ 6 0 , 0 0 0 with a 6 - year useful life. The equipment will provide cost savings of...

10. Which one of the following will not increase return on investment? A) B) C) D) Variable costs are increased An increase in sales Average operating assets are decreased Variable costs are...

A $125,000 tractor-trailer is being depreciated by the SL method over five years to a final BV of zero. Half-year convention does not apply to this asset. After three years, the rig is sold for (a)...

A Gallup/Air Transport Association survey showed that in a recent year, 52% of all air trips were for pleasure/ personal and 48% were for business. Suppose the organization randomly samples 30 air...

Tax rate 35% 1. rbond = rd 1.63% N 22 PMT 0 PV -700 FV 1000 2. rstock =rs 7.10% rs=rrf (RPm)bi=rrf (rm-rrf)bi =2.5% (6.5%-2.5%)*1.15 Beta 1.15 rrf 2.50% expected return of the market 6.50% 3. $ %...

The first scenario will be a Verbal Judo scenario in which your scenario follows the standard Verbal Judo interaction: You need to ask somebody to modify their behavior either to do something or to...

In the Meteor case study, identify how Sarahs traditional approach could be enhanced by using technology in the recruitment process.

Compare and contrast the human resources profession with that of law and medicine in respect of characteristics such as professional knowledge, ethical considerations, local expertise required,...

Relate how process reengineering is used to review and redesign HRM practices. page 680