The following data are accumulated by Patterson Inc. in evaluating two competing capital investment proposals:
Line Item Description Project C Project T
Amount of investment $125,000 $140,000
Useful life 10 years 12 years
Estimated residual value $5,000 $10,000
Estimated total income over the useful life $65,000 $108,000
Determine the expected average rate of return for each project.
Line Item Description Percentage
Project C fill in the blank 1%
Project T fill in the blank 2%
