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Managerial Accounting

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Diddie After: Tax Accounting Rate of Return

MGRACT-RM4YZK

Diddie Co. is subject to an effective tax rate of 30% and is contemplating a \$420,000 investment that will generate \$920,000 in added sales and \$840,000 in added expenses over the next six years.

What is the after-tax accounting rate of return for this project?