What is the accounting rate of return on the investment

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Dartis Company is considering investing in a specialized equipment costing $600,000. The equipment has a useful life of 5 years and a residual value of $60,000. Depreciation is calculated using the straight-line method. The expected net cash inflows from the investment are given below.
Year 1 $200,000
    2 150,000
    3 160,000
    4 95,000
    5 75,000
$680,000

What is the accounting rate of return on the investment?

Reference no: EM131821321

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