The expected average rate of return for a proposed investment of $659,500 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residualvalue, and an expected total income of $208,720 for the 4 years is (round to two decimal places)Oa 15.82%Oh. 0.32%Oc 7.91%Od 0.63 %

Expected average annual rate of return means how much returns are being generated by the investments…

The expected average rate of return for a proposed investment of $659,500 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residu value, and an expected total income of $208,720 for the 4 years is (round to two decimal places) Oa 15.82% Oh 0.32% Oc 7.91% Od 0.63 %

The expected average rate of return for a proposed investment of $659,500 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residu value, and an expected total income of $208,720 for the 4 years is (round to two decimal places) Oa 15.82% Oh 0.32% Oc 7.91% Od 0.63 %

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter12: Capital Investment Analysis

Section: Chapter Questions

Problem 1BE: Average rate of return Determine the average rate of return for a project that is estimated to yield...

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

The expected average rate of return for a proposed investment of $659,500 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residual
value, and an expected total income of $208,720 for the 4 years is (round to two decimal places)
Oa 15.82%
Oh. 0.32%
Oc 7.91%
Od 0.63 %

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