Ostead Company Is Considering an Investment with the Following Data

question 59

Multiple Choice

Ostead Company is considering an investment with the following data:
Depreciation will be taken on a straight-line basis over the expected life of the investment.
$$\begin{array} { l r } \text { Initial cost } & \$ 200,000 \\\text { Annual net cash inflows } & \$ 25,000 \\\text { Expected life } & 10 \text { years } \\\text { Salvage value } & \text { none }\end{array}$$
-Refer to the Figure.What is the accounting rate of return for the investment?

• A)2.5%
• B)10.0%
• C)12.5%
• D)20.0%

Distinguish between various business entities and their legal and tax implications.

Recognize the importance of shareholder and stakeholder roles in corporate governance and the ethical considerations in financial management.

Understand the impact of unethical behavior on public trust and confidence.

Recognize the significance and different interpretations of corporate social responsibility (CSR).

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