Cookie Cutter Corp. is considering a new project whose data are shown below. The equipment that would be used has a 5-year tax life, would be depreciated by the straight-line method over its 5-year life, and would have a zero salvage value. No change in net operating working capital would be required. Revenues and other operating costs are expected to be constant over the project's 5-year life. What is the project's IRR? Do not round the intermediate calculations. State in percentage terms without the percent sign symbol and round to the second decimal place. (Thus, 12.98756% would be written as 12.99 to be correct)

• Net investment cost (depreciable basis) = $140,000
• Straight-line depreciation rate = 20.00% per year
• Cash Sales revenues, each year = $71,000
• Annual cash operating costs (excluding depreciation) = $25,000

Answer rating: 100% (QA)

Question 1 What is the projects IRR Answer The projects IRR can be calculated by following the steps below Step 1 Calculate the Initial Investment The ... View the full answer