FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The following data are accumulated by Lone Peak Inc. in evaluating two competing capital investment proposals:
3D Printer | Truck | ||||
Amount of investment | $36,000 | $24,000 | |||
Useful life | 4 years | 5 years | |||
Estimated residual value | 0 | 0 | |||
Estimated total income over the useful life | $5,760 | $6,600 |
Determine the expected average
3D Printer | fill in the blank 1 % |
Truck | fill in the blank 2 % |
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Divide the estimated average annual income by the average investment. Investment cost plus residual value, divided by two, equals average investment.
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Divide the estimated average annual income by the average investment. Investment cost plus residual value, divided by two, equals average investment.
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