Refer to Present Value Tables. Mattress Firm is considering an investment in equipment that will have an initial cost of $600,000 yielding annual net cash inflows of $110,000. Yearly depreciation will be $60,000. The equipment is expected to be useful for 10 years, then it will be scrapped. The company requires a minimum rate of return of 10%.
Required:
A. Calculate the payback period.
B. Calculate the accounting rate of return.
C. Calculate the net present value.
D. Calculate the approximate internal rate of return.

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The Answer of Refer to Present Value Tables. Mattress Firm is considering an investment in equipment that will have an initial cost of $600,000 yielding annual net cash inflows of $110,000. Yearly depreciation will be $60,000. The equipment is expected to be useful for 10 years, then it will be scrapped. The company requires a minimum rate of return of 10%.
Required:
A. Calculate the payback period.
B. Calculate the accounting rate of return.
C. Calculate the net present value.
D. Calculate the approximate internal rate of return.