Accounting Rate of Return

Each of the following scenarios is independent. Assume that all cash flows are after$-$tax cash flows.

c$.$ Suppose that a project has an ARR of $30\%($based on initial investment$)$ and that the average net income of the project is $$120,000.$

d$.$ Suppose that a project has an ARR of $50\%$ and that the investment is $$250,000.$

Required:

Compute the ARR on the new equipment that Cobre Company is considering. Round your answer to one decimal place.

$X\%$

ARR

Project A

X $\%$

Project B

X $\%$

Based on the ARR, Emily Hansen chosen Project A $.$

How much did the company in Scenario c invest in the project? Round your answer to the nearest whole dollar.