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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

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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 taxes of $2,800 for three years. The investment costs $52,500 and has an estimated $11,100 salvage value. Compute the accounting rate of return for this investment; assume the company uses straight-line depreciation. Accounting Rate of Return Choose Numerator: 1 Choose Denominator: Annual after-tax net income 17 Annual average investment $ 2,800 / 1 Accounting Rate of Return Accounting rate of return 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 $2,800 for three years. The investment costs $52,500 and has an estimated $11,100 salvage value. Assume Peng requires a 10% return on its investments. Compute the net present value of this investment. Assume the company uses straight-line depreciation. (PV of $1. EV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign.) Cash Flow Annual cash fow Residual value * PV Factor - Present Value 2 4869 0.7513 Select Chart Amount Present Value of an Annuity Jof 1 Present Value of 1 11.100 Present value of cash inflows Immediate cash outflows Net present value

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