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Considering the purchase of equipment that would allow

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Reference no: EM13906017

B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $ 360,000 with a 6 year life and no salvage value. It will be depreciated on a straight line basis. The company expects to sell 144,000 units of the equipment's product each year. The expected annual income related to this equipment follows. Compute the 

(1) Payback period 

(2) Accounting rate of return for this equipment. 

Reference no: EM13906017

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Considering the purchase of equipment that would allow : B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line.
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