Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $121,720. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $80,100, and annual expenses (excluding depreciation) would increase by $40,100. Wayne uses the straight-line method to compute depreciation expense. The companys required rate of return is 13%. Compute the annual rate of return

Anual rate of return ____%

Determine whether the project is acceptable?

Accept/Reject the project

Do It Review 26-5 Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $121,720. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $80,100, and annual expenses (excluding depreciation) would increase by $40,100. Wayne uses the straight-line method to compute depreciation expense. The company's required rate of return is 13%. Compute the annual rate of return. (Round answer to 0 decimal places, e.g. 15%.) Annual rate of return Determine whether the project is acceptable? e project Acept Reject NRT XT