Which of the following statements is felse with respect to the simple rate of return? Multiple Choice The initial investment included in the denominator should include the cash outlay associated with that arvestment The annual incremental et operating uncome included in the numerator should indude the ncremental revenues that result from making the investment The inmat investment induded in the denominator should be reduced by the savage value of the new equpment The annual incremental net operating income included in the numerator should be reduced by the depreciation charges that results from making the investment Assume the following information for a capital budgeting proposal with a five-year time horizon $ 420,000 Initial investment: cost of equipment (zero salvage value) Annual revenues and costs: Sales revenues Variable expenses Depreciation expense Fixed out-of-pocket costs $ 300,000 $ 130,000 $ 50,000 $ 40,000 Click here to view Exhibit 14B-1 and Exhibit 14B-2. to determine the appropriate discount factor(s) using the tables provided This proposal's internal rate of return is closest to Multiple Choice 21% 14% 16%