6-17 A rough rule of thumb for the chemical industry is that $1 of annual sales requires $2 of fixed-capital investment In a chemical processing plant where this rule applies, the total capitalinvestment is $2,500,000, and the working capital is 20 percent of the total capital investment.1The annual total product cost amounts to $1,500,000. If the income tax rates on gross earningstotal 35 percent, determine the following:a. Percent of total capital investment returned annually as gross earningsPercent of total capital investment returned annually as net profitb.

A corporation makes a capital investment when it buys tangible assets to utilize in achieving its…

6-17 A rough rule of thumb for the chemical industry is that $1 of annual sales requires $2 of fixed- capital investment In a chemical processing plant where this rule applies, the total capital investment is $2,500,000, and the working capital is 20 percent of the total capital investment. | The annual total product cost amounts to $1,500,000. If the income tax rates on gross earnings total 35 percent, determine the following: a. Percent of total capital investment returned annually as gross earnings b. Percent of total capital investment returned annually as net profit

6-17 A rough rule of thumb for the chemical industry is that $1 of annual sales requires $2 of fixed- capital investment In a chemical processing plant where this rule applies, the total capital investment is $2,500,000, and the working capital is 20 percent of the total capital investment. | The annual total product cost amounts to $1,500,000. If the income tax rates on gross earnings total 35 percent, determine the following: a. Percent of total capital investment returned annually as gross earnings b. Percent of total capital investment returned annually as net profit

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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