Question
Scott Smith just bought a new StreamLink machine which will be depreciated on a straight-line basis to a book value of $39,000 at the end
Scott Smith just bought a new StreamLink machine which will be depreciated on a straight-line basis to a book value of $39,000 at the end of its four-year life. During the first two years, the net income associated with the machine is expected to be $14,000 and $17,450, respectively. During the last two years, the net income associated with the equipment is expected to be $22,100 and $13,900, respectively. What is the average-accounting return associated with the StreamLink machine? Please note that Scott paid $133,000 for the machine.
Multiple Choice 25.36% 10.14% 19.61% 23.18% 21.01%
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