Carmel Corporation is considering the purchase of a machine costing $41,000 with a 8-year useful life and no salvage value. Carmel uses straight line depreciation and assumes that the annual cash inflow from the machine will be recieved uniformaly throughout each year. In calculating the accounting rate of return, what is Carmel's average investment?

A. $41,000

B. $23,063

C. $20,500

D. $5,766

The following data concerns a proposed equipment purchase:

COST: $163,000

Salvage Value: $5,000

Estimated useful life: 4 years

Annual net cash flows: $47,100

Depreciation Method: Straight-Line

The annual average investment amount used to calculate the accounting rate of return is:

A. $81,500

B. $79,000

C. $40,750

D. $84,000