Why the chris required rate of return


Chris's Custom Manufacturing Company is considering three new projects, each requiring an equipment investment of $24,948. Each project will last for 3 years and produce the following net annual cash flows. Year AA BB CC 1 $8,748 $11,394 $14,148 2 11,232 11,394 10,908 3 16,308 11,394 11,988 Total $36,288 $34,182 $37,044 The equipment's salvage value is zero, and Chris uses straight-line depreciation. Chris will not accept any project with a cash payback period over 2 years. Chris's required rate of return is 12%.

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Accounting Basics: Why the chris required rate of return
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