Frank Company, Which Has Total Assets of $300,000, Has an Opportunity

Multiple Choice

Frank Company, which has total assets of $300,000, has an opportunity to invest $80,000 in a new project that will generate a return of $16,000 per year. Given this information, if Frank Company was earning 25% before, then accepts this project, its new return on investment will be approximately:

A) 20%
B) 22%
C) 24%
D) 26%