单选题
A division is considering investing in capital equipment costing $2·7m. The useful economic life of the equipment isexpected to be 50 years, with no resale value at the end of the period. The forecast return on the initial investmentis 15% per annum before depreciation. The division’s cost of capital is 7%.
What is the expected annual residual income of the initial investment?
【正确答案】
C
【答案解析】Divisional profit before depreciation = $2·7m x 15% = $405,000 per annum.Lessdepreciation = $2·7m x 1/50 = $54,000 per annum.Divisional profit after depreciation = $351,000Imputed interest = $2·7m x 7% = $189,000Residual income = $162,000