(Answered) Question mimi company is considering a capital investment

Accounting

Question: Mimi Company is considering a capital investment of $250,000 in new equipment. The equipment is expected to have a 5-year useful life with no salvage value. Depreciation is computed by the straight-line method. During the life of the investment, annual net income and cash inflows are expected to be $25,000 and $75,000, respectively. Mimi's minimum required rate of return is 10%.

Part (a) Calculate the payback period.

Part (b) Calculate the net present value.

Part (c) Calculate the accounting rate of return.

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