A Project Produces Annual Net Income of $11,500, $13,700, and $16,900

question 126

Multiple Choice

A project produces annual net income of $11,500, $13,700, and $16,900 over the three years of its life, respectively. The initial cost of the project is $257,000. This cost is depreciated straight-line to a zero book value over three years. What is the average accounting rate of return if the required discount rate is 6.75 %?

• A) 5.33 %
• B) 5.46 %
• C) 6.58 %
• D) 10.92 %
• E) 13.90 %

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Definitions:

Nasal Septum

A thin wall of bone and cartilage that divides the nasal cavity into two nostrils.

Nasal Conchae

Structures within the nasal cavity that increase its surface area for warming, moisturizing, and filtering the air breathed in through the nose.

Paranasal Sinuses

Air-filled spaces located within the bones of the skull and face, connected to the nasal cavity, that help humidify and filter air.

Cilia

Microscopic, hair-like structures that protrude from the surface of many cells, involved in movement and sensory functions.