) Cannon Company is considering a capital project that will return $100,000 each year for five years. At the company's hurdle rate of 10%, the present value of the annuity is $379,100. If the return on investment in the first year is $37,910, what is the return of investment that year?
A. $137,910
B. $100,000
C. $62,090
D. None of the above
Answer:D
) Cannon Company is considering a capital project that will return $100,000 each year for five years. At the company's hurdle rate of 10%, the present value of the annuity is $379,100. If the return on investment in the first year is $37,910, what is the return of investment that year?
A. $137,910 B. $100,000 C. $62,090 D. None of the above