Skuse and Mayworth Limited is considering the investment of £136 000 in a new piece of machinery.Budgeted cash inflows from the project, before taking depreciation into account, are as follows: The company's policy is to depreciate machinery on the reducing balance basis at a rate of 25% each year.In the case of this investment, it is assumed that the machine would be sold for its residual value at the end of year 3.
What is the accounting rate of return on this investment (to one decimal place)?

Question

Skuse and Mayworth Limited is considering the investment of £136 000 in a new piece of machinery.Budgeted cash inflows from the project, before taking depreciation into account, are as follows:  The company's policy is to depreciate machinery on the reducing balance basis at a rate of 25% each year.In the case of this investment, it is assumed that the machine would be sold for its residual value at the end of year 3.
What is the accounting rate of return on this investment (to one decimal place)?

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The Answer of Skuse and Mayworth Limited is considering the investment of £136 000 in a new piece of machinery.Budgeted cash inflows from the project, before taking depreciation into account, are as follows:  The company's policy is to depreciate machinery on the reducing balance basis at a rate of 25% each year.In the case of this investment, it is assumed that the machine would be sold for its residual value at the end of year 3.
What is the accounting rate of return on this investment (to one decimal place)?

Skuse and Mayworth Limited Is Considering the Investment of £136