Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. abc company uses the accounting rate of return to

ABC Company uses the accounting rate of return to help in making capital investment decisions....

50.1K

Verified Solution

Question

Accounting

ABC Company uses the accounting rate of return to help in making capital investment decisions. They give you the following information about the purchase of a new plant. The plant, a depreciable asset, has a 10-year life, will cost 500,000 with zero salvage value

Cash revenue minus cash expenses

years 1-3 100,000 each year

years 4-7 200,000 each year

years 8-10 400,000 each year

Accounting Rate of return for the plant will be:

A. 26%

B. 20%

C. 46%

D. 36%

E. Cannot be determined

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Discuss how the coefficient of determination and the coefficient of correlation are related. How are they...

Statistics
Q

Amanda Richards is a 20-year-old junior in college. She is majoring in biology and hopes someday...

Biology
Q

c. what are the Motor divisions of the ANS d. Which motor division provides craniosacral outflow...

Medical Sciences
Q

The mammary region is to the sternal region A lateral B medial C superior D...

Biology
Q

Which of the following statement is false for a perfect conductor in electrostatic condition The...

Physics
Q

Find the P-value for the indicated hypothesis test.A random sample of 139 forty-year-old men contains...

Basic Math
Q

Current Attempt in Progress Blossom Company had cash sales of $69,978...

Accounting
Q

Write a case brief 160 Business Law Today: The Essentials 5-7. Copyright...

Accounting
Q

I'll make sure to rate you! Darby Products uses a job-costing system with two...

Accounting
Q

The operations vice president of Security Home Bank has been interested in investigating the efficiency...

Accounting
Q

Included in Larkspur Companys December 31 trial balance is a note receivable of $10,800. The...

Accounting
Q

An ARM loan, Loan Amount - $250,000; Monthly Payments, Index = 1-Year Treasury bill. Index...

Finance