Compute the simple rate of return

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The management of Ballard MicroBrew is considering the purchase of an automated bottling machine for $120,000.

The machine would replace an old piece of equipment that costs $30,000 per year to operate.

The new machine would cost $12,000 per year to operate.

The old machine currently in use could be sold now for a scrap value of $40,000. The new machine would have a useful life of 10 years with no salvage value.

Required:
Compute the simple rate of return on the new automated bottling machine.

Reference no: EM131156783

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Compute the simple rate of return : Compute the simple rate of return on the new automated bottling machine.- The management of Ballard MicroBrew is considering the purchase of an automated bottling machine for $120,000.
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jam1156783

8/28/2017 8:28:39 AM

I was trying to calculate rate of return but I cannot find a way to solve it, so I went for online help and after a while of searching I luckily came across expertsmind where I got the detailed answer.

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