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Jumbo Industries Is Considering the Purchase of Equipment Costing $80,000

Question 67

Multiple Choice

Jumbo Industries is considering the purchase of equipment costing $80,000.The company has a 15% required minimum rate of return.The equipment is expected to generate $20,000 in additional operating income.What is the equipment's residual income?


A) $8,000
B) $9,000
C) $12,000
D) $15,000

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