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Dartis Company is considering investing in a specialized equipment costing $680,000. The equipment has a useful life of 5 years and a residual value
Dartis Company is considering investing in a specialized equipment costing $680,000. The equipment has a useful life of 5 years and a residual value of $60,000. Depreciation is calculated using the straight-line method. The expected net cash inflows from the investment are given below. Year 1 $203,000 157,000 2 3 161,000 4 98.000 5 81,000 $700,000 What is the accounting rate of return on the investment? OA. 2.16% B. 4.32% OC. 471% OD. 5.16%
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