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Accompany is considering purchasing factory equipment that costs $500000 and is estimated to have no salvage value at the end of its 5-year useful life.
Accompany is considering purchasing factory equipment that costs $500000 and is estimated to have no salvage value at the end of its 5-year useful life. If the equipment is purchased, annual revenues are expected to be $159000 and annual operating expenses exclusive of depreciation expense are expected to be $22000. The straight-line method of depreciation would be used. If the equipment is purchased, the annual rate of return expected on this equipment is O 5.48%. O 14.80%. O 31.80%. O 27.40%
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