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Required information [The following information applies to the questions displayed below.) Peng Company is considering an investment expected to generate an average net income after
Required information [The following information applies to the questions displayed below.) Peng Company is considering an investment expected to generate an average net income after taxes of $3,000 for three years. The investment costs $54,000 and has an estimated $10,200 salvage value. Compute the accounting rate of return for this investment, assume the company uses straight-line depreciation. Choose Numerator: Annual after-tax net income Accounting Rate of Return Choose Denominator: Annual average investment Accounting Rate of Return Accounting rate of return $ 3,000/
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