PAR Ltd is considering an investment and has determined the following: Expected net cash flows:– Year 1 $65,967– Year 2$70,290– Year 3$135,391– Year 4$103,435– Year 5$100,998Annual depreciation$20,660Period of investment5 yearsInitial investment$611,246Value at end of the investment period$124,671 Calculate the Accounting Rate of Return. Express your answer in a percentage with 2 decimal places.

Accounting rate of return means how much average annual profit can be earned on average investment…

Answered: PAR Ltd is considering an investment…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 18EB: Garnette Corp is considering the purchase of a new machine that will cost $342,000 and provide the...

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PAR Ltd is considering an investment and has determined the following:

Expected net cash flows: – Year 1	$65,967
– Year 2	$70,290
– Year 3	$135,391
– Year 4	$103,435
– Year 5	$100,998
Annual depreciation	$20,660
Period of investment	5 years
Initial investment	$611,246
Value at end of the investment period	$124,671

Calculate the Accounting Rate of Return. Express your answer in a percentage with 2 decimal places.

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