Mitsui Electronics, Limited, is considering buying a labor-saving pierce of equipment and provided the following data: Purchase cost of the equipment $ 484,500 Annual cost savings that will be provided by the equipment $ 85,000 Life of the equipment 12 years Compute the simple rate of return on the equipment. Use straight-line depreciation based on the equipment’s useful life.

Mitsui Electronics, Limited, is considering buying a labor-saving pierce of equipment and provided the following data: Purchase cost of the equipment $ 484,500 Annual cost savings that will be provided by the equipment $ 85,000 Life of the equipment 12 years Compute the simple rate of return on the equipment. Use straight-line depreciation based on the equipment’s useful life.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Purchase cost of the equipment	$ 484,500
Annual cost savings that will be provided by the equipment	$ 85,000
Life of the equipment	12	years

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