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Harvard Manufacturing Company is considering the following Initial investment: Depreciable assets (straight-line) $40,800 Working capital 3,400 Operations (per year for 4 years): Cash receipts Cash expenditures Disinvestment: Salvage value of equipment Recovery of working capital $30,000 17,000 $3,400 1,700

Harvard Manufacturing Company is considering the following Initial investment: Depreciable assets (straight-line) $40,800 Working capital 3,400 Operations (per year for 4 years): Cash receipts Cash expenditures Disinvestment: Salvage value of equipment Recovery of working capital $30,000 17,000 $3,400 1,700

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Harvard Manufacturing Company is considering the following investment proposal: Initial investment: Depreciable assets (straight-line) $40,800 Working capital 3,400 Operations (per year for 4 years): Cash receipts Cash expenditures $30,000 17,000 Disinvestment: Salvage value of equipment Recovery of working capital The investment's accounting rate of return (rounded to two decimal points) on the original investment is: Select one: O a. 31.86% O b. 29.41% O c. 6.33% d. 8.26% $3,400 1,700
Transcribed Image Text:Harvard Manufacturing Company is considering the following investment proposal: Initial investment: Depreciable assets (straight-line) $40,800 Working capital 3,400 Operations (per year for 4 years): Cash receipts Cash expenditures $30,000 17,000 Disinvestment: Salvage value of equipment Recovery of working capital The investment's accounting rate of return (rounded to two decimal points) on the original investment is: Select one: O a. 31.86% O b. 29.41% O c. 6.33% d. 8.26% $3,400 1,700
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