You manufacture car parts using equipment and direct labor. You are planning to buy a new machine for $1,000. The machine will generate net cash flows of $250 a year for 10 years. The salvage value after 10 years is zero. Compute ARR (accounting rate of return). O 50% O 15% O 25% 30% O not enough information need to know accounting income and accounting depreciation -

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The term depreciation refers to how the value of an asset (such as a car) decreases over time. There are several different approaches for calculating depreciation. Part A: In the straight-line method of calculating depreciation, the value of the item is reduced by the same amount each year. Suppose a company purchases a car for $24000. Using straight-line depreciation, the value of the car may be reduced by $2500 each year. Determine a formula for S(t), the value of the car t years after purchase. Answer: Part B: After five years, the value of the car, using the straight-line method, will be $ Part C: After twelve years, the value of the car, using the straight-line method, will be Part D: In the declining balance method of depreciation, the value of the item is reduced by the same percentage each year. Suppose the $24000 car is depreciated at a rate of 14% each year. Determine a formula for D(t), the value of the car t years after purchase. Answer: Part E: After five years, the value…

1 A new backhoe costs Bob the Builder $X. It is expected to have a salvage value of $Y after N years. What rate of depreciation for the declining-balance method should Bob be using? X= Y= N= Depreciation Rate $750,000 $58,000 29 years Try Again What is the Book Value after 25 years? Try Again (Use unrounded rate)

You purchase a new pizza oven for $9,950 which will have a scrap value of $900. Assuming a 35% depreciation rate, how much depreciation would you recognize in year one when using the Double Declining Balance depreciation method? $2,810 $3167.50 $3482.50 $3.572.75

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A business is planning to purchase new equipment at a cost of £60,000. The equipment is expected to last 4 years and to have no scrap value (residual value). Depreciation is calculated on a straight-line basis. The investment is expected to generate the following profits/(losses): Year                      1               2              3               4 Profit/(loss)     (10,000)     20,000     40,000      20,000    Required: Convert these profits/(losses) to cash flows.