Question
A company is evaluating three possible investments. Each uses the straight - line method of depreciation. The following information is provided by the company: Investment:
A company is evaluating three possible investments. Each uses the straight - line method of depreciation. The following information is provided by the company:
Investment: $212,000
Salvage Value: $30,000
Net Cash Flows
Year 1: $86,000
Year 2: $56,000
Year 3: $66,000
Year 4: $26,000
Year 5: $0
What is the accounting rate of return?
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Bank Management Text And Cases
Authors: George H. Hempel, Alan B. Coleman, Donald G. Simonson
3rd Edition
