A Project Produces Annual Net Income of $14,600, $18,700, and $23,500

Multiple Choice

A project produces annual net income of $14,600, $18,700, and $23,500 over three years, respectively. The initial cost of the project is $310,800. This cost is depreciated straight-line to a
Zero book value over three years. What is the average accounting rate of return if the required
Discount rate is 9 percent?

A) 12.18 percent
B) 14.29 percent
C) 15.63 percent
D) 17.67 percent
E) 18.28 percent