Accounting help- average rate of return

Accounting
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The expected average rate of return for a proposed investment of $600,000 in a fixed asset, with a useful life of four years, straight-line depreciation, no residual value, and an expected total net income of $240,000 for the 4 years, is:

May 8th, 2015

Average return = Agg net income/no of years

Where Agg net income =Total net income*Number of years

So it will be = (240000*4)/4= 240000

annual Avg rate of return = 240000/600000*100=40%

May 8th, 2015

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