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e average rate of return on investment,

e average rate of return on investment,

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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| MYUSF x My Home CengageNOWv2 | Online teachin X engagenow.com/ilm/takeAssignment/takeAssignmentMain.do?invoker%3D&takeAssignmentSessionLocator3D&inpro... to 全 临 Dickerson Co. is evaluating a project requiring a capital expenditure of $810,000. The project has an estimated life of 4 years and no salvage value. The estimated net income and net cash flow from the project are as follows: Year Net Income Net Cash Flow $75,000 $285,000 2 100,000 290,000 3. 109,000 190,000 4 36,000 125,000 $320,000 $890,000 The company's minimum desired rate of return is 12%. The present value of $1 at compound interest of 12% for , 2, 3, and 4 years is 0.893, 0.797, 0.712, and 0.636, respectively. Required: Determine the average rate of return on investment. Round your answer to one decimal place. Previous Next 9:40 PM 5/8/2021 2.
Transcribed Image Text:| MYUSF x My Home CengageNOWv2 | Online teachin X engagenow.com/ilm/takeAssignment/takeAssignmentMain.do?invoker%3D&takeAssignmentSessionLocator3D&inpro... to 全 临 Dickerson Co. is evaluating a project requiring a capital expenditure of $810,000. The project has an estimated life of 4 years and no salvage value. The estimated net income and net cash flow from the project are as follows: Year Net Income Net Cash Flow $75,000 $285,000 2 100,000 290,000 3. 109,000 190,000 4 36,000 125,000 $320,000 $890,000 The company's minimum desired rate of return is 12%. The present value of $1 at compound interest of 12% for , 2, 3, and 4 years is 0.893, 0.797, 0.712, and 0.636, respectively. Required: Determine the average rate of return on investment. Round your answer to one decimal place. Previous Next 9:40 PM 5/8/2021 2.
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