Question

The amount of the average investment for a proposed investment of $184,000 in a fixed asset with a useful life of 4 years, straight-line depreciation, no residual value, and an expected total income of $20,600 for the 4 years is

Answer 1

$92,000

Step-by-step explanation:

Average Investment = (Initial Investment + Scrap Value) / 2

Average Investment = ($184,000 + $0) / 2

Average Investment = $184,000 / 2

Average Investment = $92,000

Thus The amount of the average investment for a proposed investment is $92,000