Please just provide the answers that go in the yellow boxes :) B2B Co. is consid

Question

Please just provide the answers that go in the yellow boxes :)

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 $400,000 with a 12-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 160,000 units of the equipment's product each year. The expected annual income related to this equipment follows. Compute the payback period. Compute the accounting rate of return for this equipment.

Explanation / Answer

payback 400000/(35200+33333) 5.84 ARR 35200(/400000/4) 35.20%

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