An Initial Investment of $270,000 Is Expected to Generate $180,000

question 6

Multiple Choice

An initial investment of $270,000 is expected to generate $180,000 in annual cost savings over the asset's expected 3-year life.Assume straight-line depreciation and ignore income taxes.The accounting rate of return based on initial investment is _____.

• A)11.11%
• B)44.44%
• C)33.33%
• D)none of these answers is correct

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Definitions:

Authorized Purchases

Transactions made by an individual or entity that are permitted within the scope of their authority or within the terms of an agreement.

Dissolution

The process of formally ending or dissolving a company or legal entity, distributing its assets and liabilities.

Partnership at Will

A partnership at will is a business arrangement without a fixed duration, allowing any partner to dissolve the partnership at any time.

Intellectual Property

Intangible property that is the product of one’s mind and not one’s hands.