The Following Data Concerns a Proposed Equipment Purchase Assuming That Net Cash Flows Are Received Evenly Throughout the \quad

question 90

Multiple Choice

The following data concerns a proposed equipment purchase:
$\begin{array}{lr}\text{cost} & \quad & \$~ 278,000\\\text{Salvage value} & \quad & \$~ 6,000 \\\text{Estimated useful life} & \quad & 8~ \text{years}\\\text{Annual net cash flows} & \quad & \$ ~46,360\\ \text{Depreciation method} & \quad & \text{Straight-line}\\\end{array}$
Assuming that net cash flows are received evenly throughout the year,the accounting rate of return is:

• A) 34.09%
• B) 32.64%
• C) 8.35%
• D) 8.70%
• E) 16.67%

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Definitions:

Psychological Dependence

A condition characterized by an emotional or mental reliance on a substance or behavior, often accompanied by feelings of anxiety or distress when the substance or behavior is not available.

Marijuana

A psychoactive drug derived from the Cannabis plant, used both recreationally and medicinally, affecting mood, perception, and cognitive functions.

Opium

A highly addictive narcotic drug extracted from the seed pods of the opium poppy, used historically for pain relief.

Morphine

A powerful opioid pain medication derived from the opium poppy, used to treat moderate to severe pain by acting directly on the central nervous system.