Question

6. value: 16.70 points A machine costs $700,000 and is expected to yield an after-tax net income of $30,000 each year. Management predicts this machine has a 11-year service life and a $140,000 salvage value, and it uses straight-line depreciation. Compute this machine's accounting rate of return. Choose Numerator: Accounting Rate of Return Choose Denominator: = Accounting Rate of Return = Accounting rate of return

          6.
value:
16.70 points
A machine costs $700,000 and is expected to yield an after-tax net income of $30,000 each year.
Management predicts this machine has a 11-year service life and a $140,000 salvage value, and it uses
straight-line depreciation. Compute this machine's accounting rate of return.
Choose Numerator:  Accounting Rate of Return
Choose Denominator: = Accounting Rate of Return
= Accounting rate of return

6.
value:
16.70 points
A machine costs 700,000 and is expected to yield an after-tax net income of30,000 each year.
Management predicts this machine has a 11-year service life and a 140,000 salvage value, and it uses
straight-line depreciation. Compute this machine's accounting rate of return.
Choose Numerator: Accounting Rate of Return
Choose Denominator: = Accounting Rate of Return
= Accounting rate of return

Added by James P.

A Graphical Approach to College Algebra

John Hornsby,Margaret L. Lial,Gary… 6th Edition

Chapter 8

Instant Answer

Solved by Expert Lauren Long

Step 1

The average annual net income is calculated by dividing the total net income over the service life by the number of years. Total net income = After-tax net income x Number of years Total net income = $30,000 x 11 years = $330,000 Average annual net income = Total Show more…

Show all steps

Thanks for your feedback!

Question 6 (of 6) 6. value: 16.70 points A machine costs $700,000 and is expected to yield an after-tax net income of $30,000 each year. Management predicts this machine has a 11-year service life and a $140,000 salvage value, and it uses straight-line depreciation. Compute this machine's accounting rate of return Accounting Rate of Return Choose Numerator: Choose Denominator: Accounting Rate of Return 1 Accounting rate of return