Weston's Uses Straight-Line Depreciation to Zero Over a Project's Life

question 10

Multiple Choice

Weston's uses straight-line depreciation to zero over a project's life. A new project has a fixed asset cost of $2,687,300 and projected annual net income of $95,000, $162,000, $286,000, and $304,000 over Years 1 to 4. What is the average accounting return?

• A) 14.35 percent
• B) 15.63 percent
• C) 14.87 percent
• D) 15.76 percent
• E) 16.05 percent

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Definitions:

Positive Reinforcement

A process in which presenting a stimulus following a behavior increases the likelihood of the behavior occurring again.

Stimulus

A stimulus is anything in the environment that one can respond to.

Behavior

The range of actions and mannerisms made by individuals, organisms, systems, or artificial entities in conjunction with themselves or their environment.

Frequency

The rate at which a vibration occurs that constitutes a wave, either in a material (as in sound waves), or in an electromagnetic field (as in radio waves and light).