The annual profit from a project is forecasted as: Sales 80,000 Labour, materials, and overheads Depreciation 20,000

The annual profit from a project is forecasted as:

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Sales 80,000 Labour, materials, and overheads Depreciation 20,000 15,000 Net profit before tax 35,000 45,000 The project requires that a new machine be purchased for 65,000. It will be depreciated using the straight line method over four years to a residual value of 5,000. The project will cease when the machine is sold for 5,000 at the end of the fourth year. Ignoring taxation, what is the accounting rate of return? (No additional working capital is required for this project.)