65.Lawrence Manufacturing is planning to purchase a machine that will cost $12,000, have a 6-year life, and be amortized over a 3-year period with no salvage value.Lawrence expects to sellthe machine's output of 1,500 units evenly throughout each year.A projected income statementfor each year of the asset's life appears below.Sales$45,000Costs:Manufacturing$26,000Amortization on machine2,000Selling and administrative expenses15,00043,000Income before taxes$ 2,000Income tax (50%)1,000Net income$ 1,000What is the rate of return on average investment for this machine?A)33.3%.
B)16.7%.C)50.0%.D)8.3%.E)Cannot be determined from information given.66.A company buys a $27,000 machine that has an expected life of 9 years and no salvagevalue.The company anticipates a yearly net income of $1,200 after taxes of 50%, with the cashflows to be received evenly throughout each year.What is the expected rate of return on averageinvestment?
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68.X Corporation is considering buying a machine for $25,000.Its estimated useful life is 5years, with no salvage value.X anticipates annual net income after taxes of $1,500 from the newmachine.What is the rate of return on average investment, assumingthat X uses straight-lineamortization and that the income is earned uniformly throughout each year?
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69.The following data concerns a proposed equipment purchase:Cost$72,000Salvage value$ 2,000Estimated useful life4 yearsAnnual net cash inflows$23,050Amortization methodStraight-lineAssuming that net cash flows are received evenly throughout the year, the rate of return on theaverage investment is:
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