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Investment A Investment B Investment $680,000 $120,000 Useful life 10 years 10 years Estimated annual net cash inflows for 8 years $150,000 $27,000 Residual value

Investment A

Investment B

Investment

$680,000

$120,000

Useful life

10 years

10 years

Estimated annual net

cash inflows for 8 years

$150,000

$27,000

Residual value

$30,000

$0

Depreciation method

Straightline

Straightline

Required rate of return

14%

10%

What is the accounting rate of return for InvestmentA?

Group of answer choices

14%

12.1%

22.1%

12.5%

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