Solution: 26.67%
Working:
Assuming a straight line depreciation
Incremental increase in net income = Revenue - Depreciation expense = 720 - (3600/15years) = 720 - 240 = 480
Unadjusted rate of return: 480 / [3600/2] = 480 / 1800 = 26.67%
Exercise 16-14 Determining the unadjusted rate of return LO 16-4 Campbell Painting Company is considering whether...
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