Question
Project A requires a $400,000 initial investment for new machinery with a five-year life and a salvage value of $37,500. The company uses straight-line depreciation.
Project A requires a $400,000 initial investment for new machinery with a five-year life and a salvage value of $37,500. The company uses straight-line depreciation. Project A is expected to yield annual net income of $29,000 per year for the next five years. Compute Project As accounting rate of return.
Accounting Rate of Return
| Annual after-tax net income | / | Annual average investment | = | Accounting rate of return |
| $29,000 | ? | = | % ? |
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Agile Governance And Audit An Overview For Auditors And Agile Teams
Authors: Christopher Wright
1st Edition
184928587X, 978-1849285872
