alleryStart learning →Cost Rs 12,00,000 and scrap Rs 2,00,000. Average investment under ARR?
ARs 5,00,000
BRs 6,00,000
CRs 10,00,000
DRs 7,00,000
Answer & Solution
Correct answer: D. Rs 7,00,000
Average investment = (12,00,000 + 2,00,000) / 2 = Rs 7,00,000.
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Related questions
Which measures do economists prefer over payback for return?Rs 9,00,000 is invested and net cash flow is Rs 1,80,000 a year. Payback?A: profit Rs 40,000 on average investment Rs 2,00,000. B: Rs 54,000 on Rs 3,60,000. HigherCost Rs 3,00,000, scrap Rs 60,000, 4 years, total profit Rs 1,44,000. ARR?Which goal underlies capital budgeting in corporate finance?Capital budgeting mainly concerns which type of spending?Companies create value when their return on capital is above what?What drawback makes older businesses show a higher ROCE?