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The amount of the average investment for a proposed investment of $120,000 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residual value, and an expected total net income of $21,600 for the 4 years, is

Respuesta :

Answer:

$60,000

Explanation:

The computation of the average investment is shown below:

= (Proposed investment + residual value) ÷ 2

= ($120,000 + $0) ÷ 2

= $60,000

We simply take the average of the proposed investment and the residual value so that the correct amount can come.

All other information which is given is not relevant. Hence, ignored it

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