Answer:
$36000.
Explanation:
Given: Rate of return= 15%
      cost of project= $240000.
      Useful life= 5 years.
First, lets find out total income of the project.
We know, Income= [tex]\frac{Cost\ of\ project \times rate\ of\ return\times useful\ life}{100}[/tex]
Total income of project= [tex]\frac{\$ 240000\times 15\times 5}{100} = \$ 180000[/tex]
∴ Total income of project= $180000.
Now finding annual net income of the projects.
We know the useful life of the projects is 5 years.
∴ Annual net income= [tex]\frac{Total\ income}{useful\ life}[/tex]
⇒ Annual net income= [tex]\frac{\$ 180000}{5} = \$ 36000.[/tex]
The annual net income of the project is $36000, excluding depreciation expense.
