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A company is considering purchasing a machine for $100,000. The machine will generate income of $4,600 per year. Annual depreciation expense would be $1,500. The

A company is considering purchasing a machine for $100,000. The machine will generate income of $4,600 per year. Annual depreciation expense would be $1,500. The machine has no salvage value. What is the accounting rate of return?

Multiple Choice

  • 9.2%

  • 12.2%

  • 6.2%

  • 6.1%

  • 4.6%

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