Problem - A Corporation recently purchased a new machine for its factory operations at a cost of $840,000. The investment is expected to generate $250,000 in annual cash flows for a period of five years. The required rate of return is 12%. The new machine is expected to have zero salvage value at the end of the five-year period.
Instructions -
a. Using the internal rate of return method calculate an approximate interest yield for the project. [Use tables from Appendix G]
b. Should this project be accepted by the Company and why?
Need help Using the internal rate of return method calculate an approximate interest yield for the project.
Attachment:- Tables.rar