Question 1 (20marks) An initial investment of $130,000 is expected to generate annual cash inflow of $32,000 for 6 years
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Question 1 (20marks) An initial investment of $130,000 is expected to generate annual cash inflow of $32,000 for 6 years
Question 1 (20marks) An initial investment of $130,000 is expected to generate annual cash inflow of $32,000 for 6 years. Depreciation is allowed on the straight line basis. It is estimated that the project will generate scrap value of $10,500 at end of the 6th year. Calculate its accounting rate of return assuming that there are no other expenses on the project.