Venture Rentals can purchase a van that costs $30,000; it has an expected useful life of three

Question:

Venture Rentals can purchase a van that costs $30,000; it has an expected useful life of three years and no . Venture uses straight-line depreciation. Expected revenue is $15,000 per year.
Required
a. Determine the payback period.
b. Determine the unadjusted rate of return based on the average cost of the investment.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...