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The following data applies to the next 3 questions. A machine costs $16,000 and is expected to produce profit before depreciation of $5,000 in each
- The following data applies to the next 3 questions.
A machine costs $16,000 and is expected to produce profit before depreciation of $5,000 in each of years 1 and 2, and $6,000 in each of years 3 and 4. Assume that the machine is depreciated at a constant rate of $4,000 a year and that there are no taxes. |
- How much are the average accounting earnings?
| $1,000 | |
| $1,250 | |
| $1,500 | |
| $1,750 | |
| $2,000 |
1 points
QUESTION 57
- How much is the average accounting investment?
| $4,000 | |
| $4,500 | |
| $5,500 | |
| $6,500 | |
| $8,000 |
1 points
QUESTION 58
- How much is the average accounting return?
| 12.25% | |
| 15% | |
| 17.5% | |
| 18.75% | |
| 22.5% |
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