i tried 5% and 25% it is wrong? should i use interpolation? if so, how?
First Cost = 22,000
Annual Cost = 18,000
Annual Revenue = 27,000
Net Annual Revenue = 27,000 - 18,000 = 9,000
Salvage Value = 5,000
Life = 5 years
Calculating rate of return using Trial and error Method
Let the interest rate = 32%. Calculate PW at 32%.
PW = -22,000+9,000 (P/A, 32%, 5) + 5,000 (P/F, 32%, 5)
PW = -22,000+9,000 (2.3452) + 5,000 (0.2495) = 354
The PW is positive. Increase the interest rate to 35% to get negative PW.
PW = -22,000+9,000 (P/A, 35%, 5) + 5,000 (P/F, 35%, 5)
PW at 35% = -22,000+9,000 (2.2200) + 5,000 (0.2230) =-905
Using interpolation
ROR = 32% + [354 – 0 ÷ 354 – (-905)]*3% = 32.84%
The rate of return that the company made on the product is 32.84%
i tried 5% and 25% it is wrong? should i use interpolation? if so, how? Swagelok...
Swagelok Enterprises is a manufacturer of miniature fittings and valves. Over a 5-year period, the costs associated with one product line were as follows: first cost of $20,000, and annual costs of $18,000 Annual revenue was $26,000 and the used equipment was salvaged for $4,000. What rate of return did the company make on this product? The rate of return that the company made on the product is %.
Swagelok Enterprises is a manufacturer of miniature fittings and valves. Over a 5-year period, the costs associated with one product line were as follows: first cost of $21,000, and annual costs of $19,000. Annual revenue was $30,000 and the used equipment was salvaged for $5,000. What rate of return did the company make on this product? The rate of return that the company made on the product is 30
Swagelok Enterprises is a manufacturer of miniature fittings and valves. Over a 5-year period, the costs associated with one product line were as follows: first cost of $22,000, and annual costs of $19,000. Annual revenue was $26,000 and the used equipment was salvaged for $6,000. What rate of return did the company make on this product?
Swagelok Enterprises is a manufacturer of miniature fittings and valves. Over a 5-year period, the costs associated with one product line were as follows: first cost of $25,000, and annual costs of $16,000. Annual revenue was $25,000 and the used equipment was salvaged for $4,000. What rate of return did the company make on this product? The rate of return that the company made on the product is
Swagelok Enterprises is a manufacturer of miniature fittings and valves. Over a 5-year perlod, the costs associated with one product line were as follows: first cost of $20,000, and annual costs of $16,000. Annual revenue was $29,000 and the used equipment was salvaged for $10,000. What rate of return did the company make on this product? The rate of return that the company made on the product is
I need help with question 7.12. I looked at the step-by-step solution for that one but someone posted a comment saying that the answer is wrong and no one has commented on what the correct answer should be 201 Problems Determination of ROR 7.7 If a manufacturer of slectronic devices invests S650,000 in equipment for making compact piezo electric accelerometers for general purpose vibra Lion measurement estimate the rate of return from revenue of $225.000 per year for 10 years...
Tried to do some of these and I know I did them wrong. Please help Aztec Company sells its product for $160 per unit. Its actual and budgeted sales follow. Units Dollars April (actual) 4,000 $640,000 May (actual) 1,800 $288,000 June (budgeted) 5,000 $800,000 July (budgeted) 4,000 $799,000 August (budgeted) 3,800 $608,000 All sales are on credit. Recent experience shows that 28% of credit sales is collected in the month of the...
Can someone help me solve this? I initially tried it but got everything wrong so I scrapped my answers and want to start fresh. If someone could explain it in a step by step manner that would be very helpful as there are a couple of similar problems I need to solve. Thanks! Cherry Blossom Products Inc. produces and sells yoga-training products: how-to DVDs and a basic equipment set (blocks, strap, and small pillows). Last year, Cherry Blossom Products sold...
How did i solve this excel problem wrong? I added them all up at the end but did not get an equal result. Where did i messed up and how do i solve the problem? Module 01 Problem: Purchases, Repairs, Depreciation and Disposal of Fixed Assets Prepare a depreciation schedule for three delivery vehicles. Assume all vehicles below are purchased between January 1 and January 5. #1 Van: January 1 purchased a used delivery van for $20,000. The residual value...
please ignore the answers I have put so far, I think they are wrong Powell Products manufactures its products in two separate departments: Machining and Assembly. Total manufacturing overhead costs for the year are budgeted at $1,050,000. Of this amount, the Machining Department incurs $650,000 (primarily for machine operation and depreciation) while the Assembly Department incurs $400,000. The company estimates that it will incur 5,000 machine hours (all i the Machining Department) and 10,000 direct labor hours (2,000 in the...