San Remo Has a $4,000,000 Asset Investment and Is Subject

question 5

Multiple Choice

San Remo has a $4,000,000 asset investment and is subject to a 30% income tax rate.Cash inflows are expected to average $600,000 before tax over the next few years;in contrast,average income before tax is anticipated to be $500,000.The company's after-tax accounting rate of return is:

• A)8.75%.
• B)10.50%.
• C)12.50%.
• D)15.00%
• E)some other figurE.

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