The problem is attached in the file titled "Problem".. It consists of 2 parts, 1st part is calculations and the 2nd part is a short response.
The file titled "Tables" consists of two tables which have to be used, when needed, to help calculate part 1 of the problem. This is the only method that can be used with calculations, any other method may give rounding errors.
See the attached files.
See attached file for format and formulas.
A Payback period
Initial cost $109,000
Net annual cash flows $17,700
Payback period = Initial cost
Net annual cash flows
B Return on average investment
Annual net income $8,835
Initial cost of truck $109,000
Salvage value of truck $20,350
Average investment in truck $64,675
Return on average investment = Annual net income
Average investment in truck
C Net present ...
The solution calculates payback periods, returns on average investments and NPV is examined.