21) Evergreen Corp, has two divisions, Fern and Bark could use in the production of units that cost $17 widget, to manufacture. Fern's variable costs are manufacturing costs are applied rate market for $105 each. cost. If Bark purchases from Fern produces a widget that Bark 21 $60 per widget, and fixed that cost $175 in variable costs, plus the cost of the at a rate of $36 per widget. Widgets sell on the open ergreen's policy is that internal transfers will be made at full A) $60 the widgets from Fern, what will be the transfer price? B) $175 C) $105 D) $96 orp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in $100,000. an annual increase in net income after tax of The equipment will have an initial cost of $800,000 and have a 7-year life. If the salvage value of the equipment is estimated to be $75,000, what is the accounting rate of return? A) 14.28% B) 42.11% C) 147.37% D) 25.00% 23) Nelson Corp. is considering the purchase of a new piece of equipment. The cost saving from the equipment would result in an annual increase in cash flow of S100,000. The equipment will have an initial cost of $400,000 and have a 5-year life. If the salvage value of the equipment is estimated to be $75,000, what is the payback period? Ignor income taxes. A) 4.75 years B) 3.25 years C) 7.00 years D) 4.00 years 24) The method that compares the present value of a project's future cash flows to the is investment is: A) accounting rate of return. C) payback period. B) internal rate of return. D) net present value. 25) Lawrence Corp, is considering the purchase of a new piece of equipment. When discounted at a hurdle rate of 8%, the project has a net present value of $24,580 discounted at a hurdle rate of 10%, the project has a net present value of ($2894 internal rate of return of the project is: A) greater than 10%. C) between zero and 8% B) between 8% and 10%. D) zero