Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Subject: acounting 

Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $75,818 per
year. Other information about this proposed project follows:
Initial investment
Useful life
Salvage value
$375,335
7 years
$ 47,000
Assume straight line depreciation method is used.
Required:
1. Calculate the accounting rate of return for Bartlett. (Round your percentage answer to 2 decimal places.)
2. Calculate the payback period for Bartlett. (Round your answer to 2 decimal places.)
1. Accounting Rate of Return
2. Payback Period
%
years
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Transcribed Image Text:Bartlett Car Wash Co. is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $75,818 per year. Other information about this proposed project follows: Initial investment Useful life Salvage value $375,335 7 years $ 47,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Bartlett. (Round your percentage answer to 2 decimal places.) 2. Calculate the payback period for Bartlett. (Round your answer to 2 decimal places.) 1. Accounting Rate of Return 2. Payback Period % years
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