What is the project average accounting return

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Reference no: EM131997878

You’re trying to determine whether or not to expand your business by building a new manufacturing plant. The plant has an installation cost of $19 million, which will be depreciated straight-line to zero over its four-year life. If the plant has projected net income of $1,835,000, $2,155,000, $2,054,000, and $1,336,000 over these four years, what is the project’s average accounting return (AAR)?

Reference no: EM131997878

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