Larry's Lanterns is considering a project which will produce sales of £240,000 a year for the next ﬁve years.The proﬁt margin is estimated at 6% .The project will cost £290,000 and be depreciated
Straight-line to a book value of zero over the life of the project.Larry's has a required accounting
Return of 8%.This project should be _____ because the AAR is _____.
A)rejected; 4.14%
B)rejected; 6%
C)rejected; 8.28%
D)accepted; 8.28%
E)accepted; 9.93%

Question

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The Answer of Larry's Lanterns is considering a project which will produce sales of £240,000 a year for the next ﬁve years.The proﬁt margin is estimated at 6% .The project will cost £290,000 and be depreciated
Straight-line to a book value of zero over the life of the project.Larry's has a required accounting
Return of 8%.This project should be _____ because the AAR is _____.
A)rejected; 4.14%
B)rejected; 6%
C)rejected; 8.28%
D)accepted; 8.28%
E)accepted; 9.93%

Larry's Lanterns Is Considering a Project Which Will Produce Sales