Major Emig Owns a Pet Store

question 140

Essay

Major Emig owns a pet store.Major wants to convert a storeroom into a space that can be leased to a pet groomer.Major believes that pet owners coming to the store to have their pets groomed will shop while they wait and generate additional revenues for the store.The conversion would cost $180,000 and will have a useful life of 20 years.The space will be leased to a local pet groomer for $36,000 per year.Electricity, water and other utilities are expected to be $7,200 per year.
Required:
a.Calculate the annual operating income generated by the conversion project.
b.Calculate the accounting rate of return for the conversion project.
c.If the conversion project is successful in generating new business for the pet store, how will the accounting rate of return be affected?

Recognize the importance of environmental factors and community infrastructure in disease prevention.

Understand the historical development of public health initiatives and their impact on community health.

Analyze the role of government and non-governmental organizations in the advancement of public health.

Identify key figures and their contributions to public health and nursing.

---

Definitions:

Stock Split

A corporate maneuver where a firm expands its existing shares into a greater quantity to increase the shares' liquidity.

Trading Range

The range within which a security’s price fluctuates over a given period, indicating the highest and lowest prices reached.

Outstanding Shares

The total number of shares of a corporation that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.