An investor has invested $250,000 in a new rental property. Her estimated annual costs are $6000 and annual revenues are $20,000. What rate of return per year will the investor make over a 30-year period ignoring the salvage value? If the property can be sold for $200,000 what is the rate of return?

Q: what is the present worth of this investment?

A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…

Q: A newly-built business property, containing space for a store and two offices, can be purchased for…

A: The rate of return is the percentage of gain or loss on the amount of investment over a period of…

Q: Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life.…

A: Using then Present value analysis in excel

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A: Future value of a present value is the value of that amount after taking into account the time value…

Q: A firm is considering purchasing an asset that will have a useful life of 10 years and cost $5…

A: The easiest technique for measuring depreciation over time is straight-line depreciation. The same…

Q: Rental equipment is for sale for $110,000. A prospective buyer estimates he would keep the equipment…

A: Given information: Selling price for equipment : $110,000 A prospective buyers estimates that he…

Q: An investor is considering the purchase of a small office building. The NOI is expected to be the…

A: Present value of the property refers to the current worth of the property at which it can be sold or…

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A: Rate of return is the annual income from an investment expressed as a proportion of the original…

Q: A// A civil engineer wants to invest $ 72000 in a new loader, if the income from temporary leasing…

A: Given information: Investment amount : $72,000 Expected income : $14,000 Interest rate : 14%

Q: what is the annual capital recovery for the truck?

A: Formula: PV Factor= 11+rn Annuity PV Factor= 1-1+r-nr where, r is rate per periods n is number of…

Q: A property could be sold today for $2 million. It has a loan balance of $1 million and, if sold, the…

A: The rate of return which is received by an investor due to an additional unit of investment made is…

Q: What are the Equivalent annual savings?

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: You purchased a building 5 years ago for P 5M. Its annual maintenance expense has been P 250,000 per…

A: Cash Flow Diagram: It consists of a horizontal line that represent income and expenses over  time…

Q: Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life.…

A: Present worth is the project is the present value of future cash flows

Q: A business is generating $100,000 annually over 10 years, with a salvage value of $1,000,000 in the…

A: Use the table below: Cost 10.00%     Cash flows Year Discounted CF = Cash flow/(1+cost)^year…

Q: A company is trying to decide whether to buy a machine for $ 80,000 which will saved $20000 a year…

A: The question is based on the concept of capital budgeting and its techniques. Internal rate of…

Q: Armor Investment Company is considering the acquisition of a heavily depreciated building on 10…

A: Given: The building gets depreciated on 10 acres of land. The cash flow is $100,000 Rate of interest…

Q: Determine whether this investment is an attractive option for the company.

A: Net present value (NPV) of an alternative/project refers to the variance between the initial…

Q: You are considering purchasing a dump truck. The truck will cost $45,000 and have operating and…

A: Computation:

Q: A drill press was purchased for $300,000. It was expected to last 10 years and to have a salvage…

A: Computation:

Q: The heat loss through the exterior walls of a processing plant is expected to cost the owner $3000…

A: Rate of return is calculated in a case where NPV = 0 Rate of return is usually calculated on trail…

Q: J&M Manufacturing plans on purchasing a new assembly machine for $32,000 to automate one of its…

A: Part (a): Calculation of payback period (investment plus installment costs): Answer: Payback period…

Q: what is the after tax salvage value?

A: Information Provided: Initial costs = $190,000 Maintenance costs = $34,000 Life = 3 years…

Q: If an asset costs $65,000 and is expected to have a $5,000 salvage value at the end of its ten-year…

A: Cash payback period  = Initial  investment  /annual cash inflow

Q: Margaret has a project with a $28000 first cost that returns $5000 per year over its 10-year life.…

A: The net present value function or concept can be used to determine the net present value of a future…

Q: The heat loss through the exterior walls of a processing plant is estimated to cost the owner $3,000…

A: A n arithmetic gradient cash flow is a cash flow which either increases or decreases period by…

Q: You are provided with the following details of a proposed investment in a new machine: The factory…

A: Here, Time Period of Machine is 20 years Other Details are as follows:

Q: raight

A: Average cost of investment is generally used in Accountingrate of return concept. In accounting rate…

Q: Seema is looking at an investment in upgrading an inspection line at her plant. The initial cost…

A: Capital Recovery: Using the capital recovery factor, you can figure out how much money you have in…

Q: An engineer is planning to purchase a CHB machine worth 180,000 that can produce a uniform annual…

A: Before investing in new assets or projects, feasibility of the project is evaluated by using various…

Q: You are interested in purchasing a machine that will save $200,000 per yearbefore taxes. The cost of…

A: Net present value (NPV) is the difference between the present values of cash inflows and cash…

Q: w machine costing $150,000 is expected to save the McKaig Brick Company $11,000 per year for 5 years…

A: The cash flow from the project are the after tax benefits of equipment and the benefit of…

Q: Robert Cooper is considering purchasing apiece of business rental property containing storesand…

A: The property belongs to a 39-year real-property class of MACRS. The property will be in use for a…

Q: Belmont Corp. is considering the purchase of a new piece of equipment. The cost savings from the…

A: Formulas:-               Rate of Return = (Net benefit or loss generated by new equipment /…

Q: The required investment cost of a new, large shopping center is $50 million. The salvage value of…

A: Cost of a shopping center= $50 million Salvage value of the project= $20 million Project’s life= 15…

Q: Elena's Café is investing in a new commercial refrigeration unit that will cost $40,000. They…

A: The present worth of capital investment is calculated as the difference between the present value of…

Q: A company is trying to decide whether to buy a machine for $ 80,000 which will saved $20000 a year…

A: IRR is the rate of return of a project where the  present value of the cost of the project is equal…

Q: Anewly built property, containing space fora store and two offices, can be purchased for P1200,000 A…

A: Rate of return refers to the rate at which the cash inflows are received. This is the rate at which…

Q: A new machine will cost P17000 and will have an estimated salvage value of P11000 in five years.…

A: Total first cost (C) = P 17000 + P 5000 = P 22000 Total salvage value (S) = P 11000 + P 2500 = P…

Q: RKE & Associates is considering the purchase of a building it currently leases for $30,000 per…

A: Investment recovery Investment Amount / Lease per year = PVAF ( Interest rate, years )

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Q: Dreamville Records fashioned an extension and renovation to its recording studio at Fayetteville,…

A: Using the NPER function in excel

Computerized Accounting System

The Computerized Accounting System is generally a system of maintaining accounts using computers. In this method of accounting system, the accounting transactions are processed through the use of hardware and software to generate the reports such as journals, ledgers, trial balance, trading account, P/L accounts, balance and other reports.