The Expected Rate of Return on Average Investment of the Machine

question 112

Multiple Choice

The expected rate of return on average investment of the machine is:

• A) 10%.
• B) 17%.
• C) 18.6%.
• D) 48%.

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Definitions:

Cost of Goods Sold

Costs directly related to creating products that a company offers for sale.

Net Income

The amount of earnings left over after all expenses have been deducted from revenue, indicating the financial profitability of a business.

Gross Profit Method

A technique to estimate the inventory's value by deducting the cost of goods sold from the total sales revenue.