Youâre trying to determine whether or not to expand your business by building a new manufacturing plant. The plant has an installation cost of $20.2 million, which will be depreciated straight-line to zero over its four-year life.
Required: If the plant has projected net income of $1,895,000, $2,185,000, $2,114,000, and $1,366,000 over these four years, what is the projectâs average accounting return (AAR)? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
Average accounting return %
| Youâre trying to determine whether or not to expand your business by building a new manufacturing plant. The plant has an installation cost of $20.2 million, which will be depreciated straight-line to zero over its four-year life. |
| Required: |
| If the plant has projected net income of $1,895,000, $2,185,000, $2,114,000, and $1,366,000 over these four years, what is the projectâs average accounting return (AAR)? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Average accounting return | % |
Related questions
| Youâre trying to determine whether to expand your business by building a new manufacturing plant. The plant has an installation cost of $12.3 million, which will be depreciated straight-line to zero over its four-year life. If the plant has projected net income of $1,884,300, $1,937,600, $1,906,000, and $1,359,500 over these four years, what is the projectâs average accounting return (AAR)? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
| Average accounting return ? |
