Martin Is Analyzing a Project and Has Gathered the Following

Multiple Choice

Martin is analyzing a project and has gathered the following data.Based on this data,what is the average accounting rate of return? The firm depreciates it assets using straight-line depreciation to a zero book value over the life of the asset.
$\begin{array}{|l|l|l|}\hline \text { Year } & \text { Cash Flow } & \text { Net Income } \\\hline 0 & -£ 642,000 & \mathrm{n} / \text { a } \\\hline 1 & £ 170,000 & £ 9,500 \\\hline 2 & £ 240,000 & £ 79,500 \\\hline 3 & £ 205,000 & £ 44,500 \\\hline 4 & £ 195,000 & £ 34,500 \\\hline\end{array}$

A) 13.08%
B) 15.77%
C) 21.83%
D) 26.17%
E) 31.54%