Jumbo Industries Is Considering the Purchase of Equipment Costing $80,000

question 2

Multiple Choice

Jumbo Industries is considering the purchase of equipment costing $80,000.The company has a 15% required minimum rate of return.The equipment is expected to generate $20,000 in additional operating income.What is the equipment's residual income?

• A) $8,000
• B) $9,000
• C) $12,000
• D) $15,000

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Definitions:

Actual Parameter

An actual parameter refers to the actual value or reference passed to a function or method during its invocation.

One-To-One Correspondence

A relationship in which each element of one set is paired with exactly one element of another set, and vice versa.

Primitive Value

A simple value of a primitive type in programming, such as an integer or a boolean, not associated with any object.

Return Statement

A part of a function or method that specifies the data to be sent back to the caller.