-Rodriguez Inc. is considering a project that costs $200,000. The company expects the annual cash revenues to be $75,000 and annual expenses (including depreciation) to be $30,000. The project has a ten-year useful life and a residual value of $25,000. Assume Rodriguez Inc. uses straight line method of depreciation. Using the above information for Rodriguez, what is the accounting rate of return for the project

-

Lopez Co. is interested in purchasing equipment that would improve its operational efficiency. The cost of the equipment is $400,000 with an estimated residual value of $30,000 and a useful life of ten years. The equipment is expected to fetch cash inflows of $60,000 a year. The company's minimum rate of return is 8 percent. The present value of $1 for ten years at 8 percent is 0.463, and the present value of an annuity of $1 at 8 percent and ten years is 6.710. What is the rate of return that project earns and the net present value