Information for two alternative projects involving machinery investments follows:

	Project 1	Project 2
Initial investment	$ (140,000)	$ (110,000)
Salvage value	0	20,000
Annual income	17,500	14,950

a. Compute accounting rate of return for each project. b. Based on accounting rate of return, which project is preferred?

Exercise 11-5 (Algo) Accounting rate of return LO P2 Information for two alternative projects involving machinery investments follows: a. Compute accounting rate of return for each project. b. Based on accounting rate of return, which project is preferred? Complete this question by entering your answers in the tabs below. Compute accounting rate of return for each project