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Company A is planning to invest $60,000 in a project and the project will last 5-years. The company uses straight-line depreciation to a zero book
Company A is planning to invest $60,000 in a project and the project will last 5-years. The company uses straight-line depreciation to a zero book value over the life of the project. The projected net income from the project is $2,500, $3,000, $3,500, $4,000, and $4,500 a year for the next five years, respectively. What is the average accounting rate of return?
Select one: a. 11.67% b. 13.56% c. 12.50% d. 6.10%
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