Koeq Enterprises is considering a long-term investment project called ZIP. ZIP will require an investment of NT$1,200,000.
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Koeq Enterprises is considering a long-term investment project called ZIP. ZIP will require an investment of NT$1,200,000. It will have a useful life of 4 years and no residual value. Annual cash inflows would increase by NT$800,000, and annual cash outflows would increase by NT$400,000. The company’s required rate of return is 12%. Calculate the internal rate of return on this project and discuss whether it should be accepted.
Internal Rate of ReturnInternal Rate of Return of IRR is a capital budgeting tool that is used to assess the viability of an investment opportunity. IRR is the true rate of return that a project is capable of generating. It is a metric that tells you about the investment...
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Related Book For
Accounting Principles
ISBN: 978-1119419617
IFRS global edition
Authors: Paul D Kimmel, Donald E Kieso Jerry J Weygandt
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