McDonald's Retail McDonald's Retail is considering an investment in a delivery truck.McDonald has found a used truck that he can purchase for $8,000.He estimates the truck would last six years and increase his store's net cash revenues by $2,000 per year.At the end of six years,the truck would have no salvage value and would be discarded.McDonald will depreciate the truck using the straight-line method.
Refer to McDonald's Retail.What is the accounting rate of return on the truck investment (based on average profit and average investment) ?
A) 25.0%
B) 50.0%
C) 16.7%
D) 8.3%
Correct Answer:
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