Capital recovery (CR) is the equivalent annual cost of owning the asset plus the return on the initial investment. In other words, it is the equivalent annual amount that a machine, process, or system must earn (revenue) each year to just recover the initial investment plus the stated rate of return over its expected life.

a. True

b. False

Question

Daniel

Business

13 June, 00:20

Capital recovery (CR) is the equivalent annual cost of owning the asset plus the return on the initial investment. In other words, it is the equivalent annual amount that a machine, process, or system must earn (revenue) each year to just recover the initial investment plus the stated rate of return over its expected life.

a. True

b. False

+2

Answers (2)

Know the Answer?

Willie Bryan · Answer 1

True

Explanation:

Capital recovery (CR) can also be defined as the equivalent amount that an asset, system or process must earn on a yearly basis to recover mainly the cost of acquiring it, and a state interest in the course of its expected useful life. When calculating the Capital Recovery of an asset, we must consider its salvage value.

Serena Rogers · Answer 2

a. True

Explanation:

It includes the equivalent amount initially invested plus interest rate that one can earn the funds by investing elsewhere.