1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
soldi70 [24.7K]
3 years ago
5

An investment has an initial cost of $2.7 million and net income of $189,400, $178,600, and $172,500 for Years 1 to 3. The avera

ge book value is $1.35 million. Should this project be accepted based on the average accounting rate of return if the required rate is 12.5 percent? Why or why not?
a. Yes, because the AAR is 12.5 percent
b. Yes, because the AAR is less than 12.5 percent
c. Yes, because the AAR is greater than 12.5 percent
d. No, because the AAR is greater than 12.5 percent
e. No, because the AAR is less than 12.5 percent
Business
1 answer:
DochEvi [55]3 years ago
4 0

Answer: c. Yes, because the AAR is greater than 12.5 percent

Explanation:

Average Accounting rate of return = Average Net Income / Average Assets

Average Net income = (189,400 + 178,600 + 172,000) / 3 years

= $180,166.66667

Average Assets = 2,700,000 / 3 years

= $900,000

Average Account rate of return = 180,166.66667/ 900,000

= 20.01%

<em>The AAR at 20.01% is greater than the required rate which is 12.5% so the project should be accepted. </em>

You might be interested in
Hilary had an outside basis in LTL General Partnership of $10,000 at the beginning of the year. LTL reported the following items
topjm [15]

Answer:

Hilary's adjusted basis at the end of the year $0

Explanation:

Hillary's base in general business income and tax-free income grows and then deducts . He understood the cash flow from his original cash disbursement and partnership debt reduction.  Hillary must report a capital gain of $ 12,000 on a zero interest basis in her partnership interest, since his actual and perceived cash distribution exceeds his base after raising it through a positive adjustment for the year.

$10,000 + $5,000 - $3,000 - $10,000 - $2,000  = 0

3 0
3 years ago
Why is price competition more of a factor in internet sales than other forms of retail?​
Kipish [7]

Answer: I believe it's C, because it says that there are many different prices, and it makes sense because there are so many different selling sites

8 0
3 years ago
For the current year ended October 31, Friedman Company expects fixed costs of $14,300,000, a unit variable cost of $250, and a
Nana76 [90]

Explanation:

Breakeven=fixed cost/selling price - variable cost

so 14,300000/380-250

14,300000/130 = 110,000 units to be able to make break even

5 0
3 years ago
Competition between the firms leads to greater marketing expenses. <br><br> a. True<br> b. False
ss7ja [257]
True. With competition in a market, firms have to compete to stay ahead of the others
5 0
3 years ago
Trevor gets a haircut before his interview. He wears his best suit to the interview. Walking into the room, he says hello, looks
marysya [2.9K]

Answer:

b. his eye contact.

Explanation:

Eye contact defines that it occurs when two people look at each other at the same time. It is a part of non-verbal communication when two people look at each other and thus its impact on social behavior.

Now, According to the given situation, Trevor gets a haircut and he dressed well for the interview. He is entering into the room of interview, wished and shake his hand to the interviewer after looking into his hand. Here, Trevor needs to improve his eye contact with their skills and abilities at the time of the interview.

6 0
3 years ago
Other questions:
  • The last element of a formal business letter should be the salutation followed by your signature.
    5·1 answer
  • Less certain a cash flow, the ________ the risk, and ________ the present value of the cash flow. higher; lower lower; lower hig
    5·2 answers
  • ________ is an annuity with payments made at the beginning of each period.
    7·1 answer
  • On January 1, 2018, Moonbucks, Inc., received $79,380 and agreed to pay $100,000 in 3 years on December 31, 2020. The market rat
    10·1 answer
  • "books are the best of things, well used; abused, among the worst. what is the right use? what is the one end which all means go
    12·1 answer
  • Ricardo wants to study the academic performance of graduate students in the u.s. first, he decides that he will study schools in
    7·1 answer
  • The Total Debt to Total Capital ratio is an effective type of debt management ratio because it gives an idea of:______
    14·1 answer
  • Vaughn’s Manufacturing Company can make 100 units of a necessary component part with the following costs: Direct Materials $1270
    7·1 answer
  • The Dorilane Company specializes in producing a set of wood patio furniture consisting of a table and four chairs. The set enjoy
    11·1 answer
  • What negative consequences can emerge when vision, mission, or values contradict strategy? Name a time where you believe strateg
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!