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?
A) 14.15% B) 12.26% C) 10.74% D) 26.92%
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Auditing Theory And Practice
Authors: Jerry R. Strawser, Robert H. Strawser, Roger H. Hermanson
9th Edition
0873939336, 9780873939331
