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Determine accounting rate of return on initial investment

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Question - Payback Period and Accounting Rate of Return: Equal Annual Operating Cash Flows with Disinvestment - Minn is considering an investment proposal with the following cash flows:

Initial investment-depreciable assets $100,000

Net cash inflows from operations (per year for 10 years) 25,000

Disinvestment-depreciable assets 19,000

a. Determine the payback period.

b. Determine the accounting rate of return on initial investment.

c. Determine the accounting rate of return on average investment.

Reference no: EM133056652

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