Norman rentals can purchase a van that costs 78000 it has


Norman Rentals can purchase a van that costs $78,000; it has an expected useful life of three years and no salvage value. Norman uses straight-line depreciation. Expected revenue is $39,221 per year. Assume that depreciation is the only expense associated with this investment.

Required

a. Determine the payback period. (Round your answer to 1 decimal place.)

b. Determine the unadjusted rate of return based on the average cost of the investment. (Round your answer to 1 decimal place. (i.e., .234 should be entered as 23.4).)

Request for Solution File

Ask an Expert for Answer!!
Financial Accounting: Norman rentals can purchase a van that costs 78000 it has
Reference No:- TGS01698919

Expected delivery within 24 Hours