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What would be the accounting rate of return for this project

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Reference no: EM132090246

Question - Natt Ltd is considering undertaking a project that would yield annual profits (after depreciation) of £68,000 for 5 years. The initial outlay of the project would be £800,000 and the project's assets would have a residual value of £50,000 at the end of the project.

What would be the accounting rate of return for this project?

a) 16%

b) 8.5%

c) 8.0%

d) 9.1%

Reference no: EM132090246

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