Fulton Corporation Purchased an Asset Costing $525,000

Multiple Choice

Fulton Corporation purchased an asset costing $525,000. The asset has a 4 year life, $90,000 salvage value, and is depreciated on a straight line method. During the past four years, Fulton posted net income of $15,000, $18,500, $20,000 and $21,000. Given the following information, calculate the company's average accounting return over the past four years.

A) 5.12%
B) 6.24%
C) 7.36%
D) 8.48%
E) 9.60%