Exercise 12-8 payback period and simple rate of return [lo12-1, lo12-6] [the following information applies to the questions displayed below.] nick’s novelties, inc., is considering the purchase of new electronic games to place in its amusement houses. the games would cost a total of $672,000, have a fifteen-year useful life, and have a total salvage value of $67,200. the company estimates that annual revenues and expenses associated with the games would be as follows: revenues $ 260,000 less operating expenses: commissions to amusement houses $ 90,000 insurance 36,000 depreciation 40,320 maintenance 50,000 216,320 net operating income $ 43,680 exercise 12-8 part 2 2a. compute the simple rate of return promised by the games. 2b. if the company requires a simple rate of return of at least 5%, will the games be purchased?

Accounts receivable arising from sales to customers amounted to $40,000 and $55,000 at the beginning and end of the year, respectively. income reported on the income statement for the year was $180,000. exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is

Suppose an economist believes that the price level in the economy is directly related to the money supply, or the amount of money circulating in the economy. the economist proposes the following relationship: p=a x m - p=price level - m=money supply - a=a composite of other factors, including real gdp, that change very slowly over time. how might an economist gather empirical data to test the proposed relationship between money and the price level? an economist would persuade the federal reserve to change the money supply to various levels, and observe the resulting changes in the price level. unlike researchers in the hard sciences, economists cannot study complex relationships using data. economists do not usually develop theoretical models of the economy but only analyze summary statistics about the current state of the economy. an economist would look for data on past changes in the money supply, and note the resulting changes in the price level

What is the second step in communication planning? determine the purpose of the message outline the communication for delivery determine the best channel of communication clarify objectives identify the audience