Question: A company is evaluating three possible investments. Each uses the straight-line method of depreciation. The following information is provided by the company: Project A Project
A company is evaluating three possible investments. Each uses the straight-line method of depreciation. The following information is provided by the company: Project A Project B Project C Investment $218,000 $54,000 $218,000 Residual value 0 14,000 22,000 Net cash inflows: Year 1 66,000 34,000 82,000 Year 2 66,000 25,000 52,000 Year 3 66,000 21,000 62,000 Year 4 66,000 18,000 22,000 Year 5 66,000 0 0 What is the accounting rate of return for Project C? (Round your answer to two decimal places.) A. 13.76% B. 4.58% C. 10.09% D. 33.33%
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Question: A company is evaluating three possible investments. Each uses the straight-line method of depreciation. Following information is provided by the company: Investment Residual value Net cash inflows: Year 1 Project A Project B $200,000 $50,000 12,000 A. 40.26% B. 61.29% C. 27.64% D. 58.05% 0 Project C $200,000 28,000 64,000 38,000 92,000 Year 2 64,000 29,000
A company is evaluating three possible investments. Each uses the straight-line method of depreciation. Following information is provided by the company: Investment Residual value Net cash inflows: Year 1 Project A Project B $200,000 $50,000 12,000 A. 40.26% B. 61.29% C. 27.64% D. 58.05% 0 Project C $200,000 28,000 64,000 38,000 92,000 Year 2 64,000 29,000 62,000 Year 3 64,000 25,000 72,000 Year 4 64,000 22,000 32,000 Year 5 64,000 0 0 What is the accounting rate of return for Proiect B? (Round your answer to two decimal places.)
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