A Project Produces Annual Net Income Amounts of $8,200, $17,800

question 106

Multiple Choice

A project produces annual net income amounts of $8,200, $17,800, and $20,900 over its 3-year life. The initial cost is $198,900, which 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 14.5 percent?

• A) 15.72 percent
• B) 16.67 percent
• C) 18.98 percent
• D) 17.25 percent
• E) 16.84 percent

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Definitions:

Dependent Care Expenses

Costs related to the care of dependents, such as children or elderly family members, that can sometimes qualify for tax deductions or credits.

Qualifying Individuals

People who meet specific criteria set by laws or programs, often regarding tax benefits, social services, or other legal contexts.

Dependent Care

Expenses related to the care of dependents, like children or elderly, which can be eligible for tax credits or deductions.

Qualifying Individual

A person who meets specific requirements set by a legal system or government program, often for tax purposes or eligibility for benefits.