Homework Answers
Average net income=Total net income/Total time period
=(21000+21900+24600+17900)/4=$21350
Average investment=(255,000/2)=$127500
AAR=Average net income/Average investment
=$21350/127500
=16.75%(Approx).
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2.
Mountain Frost is considering a new project with an initial cost of $255,000. The equipment...
1) Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a...
1) Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net income for each year is $21,300, $22,200, $24,600, and $18,200, respectively. What is the average accounting return? A) 14.65% B) 15.98% C) 7.99% D) 11.99% E) 17.12%
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A new project has an initial cost of $175,000. The equipment will be depreciated on a...
A new project has an initial cost of $175,000. The equipment will be depreciated on a straight-line basis to a book value of $67,000 at the end of the four-year life of the project. The projected net income each year is $15,400, $18,150, $23,500, and $15,300, respectively. What is the average accounting return? Multiple Choice 16.02 % 8.27% 20.67 % 14.95% 18.34%
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Makeup for Exam 1 Please turn in a Scantron (green, half page) with your answer choice and written solutions showing ALL work to get credit. This makeup is worth up to 15 points (Equivalent to 3 multiple choice questions in Exam 1). 1) Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net...
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6. A project has the following cash flows. What is the payback period? 7. Delta Mu...
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7. Delta Mu Delta is considering purchasing some new
equipment costing $373,000. The equipment will be depreciated on a
straight-line basis to a zero book value over the four-year life of
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1) Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net income for each year is $21,300, $22,200, $24,600, and $18,200, respectively. What is the average accounting return? A) 14.65% B) 15.98% C) 7.99% D) 11.99% E) 17.12%
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Makeup for Exam 1 Please turn in a Scantron (green, half page) with your answer choice and written solutions showing ALL work to get credit. This makeup is worth up to 15 points (Equivalent to 3 multiple choice questions in Exam 1). 1) Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net...
6. A project has the following cash flows. What is
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7. Delta Mu Delta is considering purchasing some new
equipment costing $373,000. The equipment will be depreciated on a
straight-line basis to a zero book value over the four-year life of
the project. Projected net income for the four years is $16,900,
$25,300, $27,700, and $18,400. What is the average accounting rate
of return?
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will produce cash inflows of...
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