Martin Brother Is Considering Investing $20,000 in a Project with the Following

question 30

Multiple Choice

Martin Brother is considering investing $20,000 in a project with the following cash revenues and expenses:
$\begin{array}{lll}&&\text { Cash Expenses \& }\\&\text { Revenues }&\text { Depreciation }\\\text { Year 1 } & \$ 8,000 & \$ 8,000 \\\text { Year 2 } & \$ 12,000 & \$ 8,000 \\\text { Year 3 } & \$ 15,000 & \$ 9,000 \\\text { Year 4 } & \$ 20,000 & \$ 10,000 \\\text { Year 5 } & \$ 20,000 & \$ 10,000\end{array}$
-Refer to the Figure.What is the accounting rate of return for the project?

• A)30%
• B)45%
• C)75%
• D)150%

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