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Author Question: Gibson Manufacturing is considering buying an automated machine that costs $600,000. It requires ... (Read 53 times)

misspop

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Gibson Manufacturing is considering buying an automated machine that costs $600,000. It requires working capital of $60,000. Annual cash savings are anticipated to be $280,200 for five years. The company uses straight-line depreciation. The salvage value at the end of five years is expected to be $24,000. The working capital will be recovered at the end of the machine's life. 

Required: 
Compute the accrual accounting rate of return based on the initial investment.


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Marked as best answer by misspop on Mar 6, 2021

jesse.fleming

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misspop

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Reply 2 on: Mar 6, 2021
Gracias!


Missbam101

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Reply 3 on: Yesterday
Excellent

 

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