Purvell Corporation Has Just Acquired a New Machine with the Following

question 84

Multiple Choice

Purvell Corporation has just acquired a new machine with the following characteristics (Ignore income taxes.) : The company uses straight-line depreciation and a $5,000 salvage value. Assume cash flows occur uniformly throughout a year except for the initial investment and the salvage at the end of the project.
The simple rate of return would be closest to:

• A) 30.0%
• B) 17.5%
• C) 18.75%
• D) 12.5%

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Acute Care

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