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The Post Company is considering investing in two alternative projects: Investment Useful life (years) Estimated annual net cash inflows for useful life Residual value
The Post Company is considering investing in two alternative projects: Investment Useful life (years) Estimated annual net cash inflows for useful life Residual value Depreciation method Required rate of return Project 1 $600,000 Project 2 $210,000 9 8 $110,000 $70,000 $24,000 Straight-line $18,000 Straight-line 15% 8% What is the accounting rate of return for Project 2? (Round any intermediary calculations to the nearest dollar, and round your final answer to the nearest hundredth of a percent, X.XX%.) A. 21.90% B. 8.57% C. 33.33% D. 60.95%
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