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The following data concerns a proposed equipment purchase: Cost $144,000 Salvage value $4,000 Estimated useful life 4 years Annual net cash flows $46,100 Depreciation method
The following data concerns a proposed equipment purchase:
Cost | $144,000 |
Salvage value | $4,000 |
Estimated useful life | 4 years |
Annual net cash flows | $46,100 |
Depreciation method | Straight-line |
The annual average investment amount used to calculate the accounting rate of return is:
$72,000
$70,000
$37,000
$74,000
$48,950
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