= Homework: Chapter 7 Cc Homework Question 5, Problem 7-2. Part 1 of 3 HW Score: 89%, 89 of 100 points O Points: 0 of 11 Save The Ingersoll Engineering Company is considering the purchase of a gas flow meter. Its purchase price is $9,400 and another $450 will be spent shipping and installing this device. Use of the meter is expected to result in a $8,950 annual increase in revenue, and operating expenses are estimated to be $5,200 per year. The meter will be used for five years, and then it will be sold for an estimated market value of $2,600. The meter's MACRS property class is five years. Determine the after-tax IRR on this investment f the effective income tax rate (t) is 21%. If the after-tax MARR is 9%, should this gas flow meter be purchased, installed and utilized by the company? What is the payback period based on the after-tax cash flows? Click the icon to view the GDS Recovery Rates (k). Click the icon to view the interest and annuity table for discrete compounding when the MARR is 9% per year. N The after-tax IRR on the investment is %. (Round to one decimal place.) GDS Recovery Rates (ro) for the Six Personal Property Classes Recovery Period (and Property Class) Year 3-year 5-year 7-year 10-year 15-year 1 0.3333 0.2000 0.1429 0.1000 0.0500 2 0.4445 0.3200 0.2449 0.1800 0.0950 3 0.1481 0.1920 0.1749 0.1440 0.0855 4 0.0741 0.1152 0.1249 0.1152 0.0770 5 0.1152 0.0893 0.0922 0.0693 6 0.0576 0.0892 0.0737 0.0623 7 0.0893 0.0655 0.0590 8 0.0446 0.0655 0.0590 9 0.0656 0.0591 10 0.0655 0.0590 11 0.0328 0.0591 12 0.0590 13 0.0591 14 0.0590 15 0.0591 16 0.0295 17 18 19 20 21 1 2 3 20-year 0.0375 0.0722 0.0668 0.0618 0.0571 0.0528 0.0489 0.0452 0.0447 0.0447 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0223 Discrete Compounding; i =9% Single Payment Uniform Series Compound Compound Sinking Amount Present Amount Present Fund Factor Worth Factor Factor Worth Factor Factor To Find F To Find P To Find F To Find P To Find A Given P Given F Given A Given A Given F F/P P/F FIA P/A A/F 1.0900 0.9174 1.0000 0.9174 1.0000 1.1881 0.8417 2.0900 1.7591 0.4785 1.2950 0.7722 3.2781 2.5313 0.3051 1.4116 0.7084 4.5731 3.2397 0.2187 1.5386 0.6499 5.9847 3.8897 0.1671 1.6771 0.5963 7.5233 4.4859 0.1329 1.8280 0.5470 9.2004 5.0330 0.1087 1.9926 0.5019 11.0285 5.5348 0.0907 2.1719 0.4604 13.0210 5.9952 0.0768 2.3674 0.4224 15.1929 6.4177 0.0658 Capital Recovery Factor To Find A Given P A/P 1.0900 0.5685 0.3951 0.3087 0.2571 0.2229 0.1987 0.1807 0.1668 0.1558 4 5 6 7 8 9 10 = Homework: Chapter 7 Cc Homework Question 5, Problem 7-2. Part 1 of 3 HW Score: 89%, 89 of 100 points O Points: 0 of 11 Save The Ingersoll Engineering Company is considering the purchase of a gas flow meter. Its purchase price is $9,400 and another $450 will be spent shipping and installing this device. Use of the meter is expected to result in a $8,950 annual increase in revenue, and operating expenses are estimated to be $5,200 per year. The meter will be used for five years, and then it will be sold for an estimated market value of $2,600. The meter's MACRS property class is five years. Determine the after-tax IRR on this investment f the effective income tax rate (t) is 21%. If the after-tax MARR is 9%, should this gas flow meter be purchased, installed and utilized by the company? What is the payback period based on the after-tax cash flows? Click the icon to view the GDS Recovery Rates (k). Click the icon to view the interest and annuity table for discrete compounding when the MARR is 9% per year. N The after-tax IRR on the investment is %. (Round to one decimal place.) GDS Recovery Rates (ro) for the Six Personal Property Classes Recovery Period (and Property Class) Year 3-year 5-year 7-year 10-year 15-year 1 0.3333 0.2000 0.1429 0.1000 0.0500 2 0.4445 0.3200 0.2449 0.1800 0.0950 3 0.1481 0.1920 0.1749 0.1440 0.0855 4 0.0741 0.1152 0.1249 0.1152 0.0770 5 0.1152 0.0893 0.0922 0.0693 6 0.0576 0.0892 0.0737 0.0623 7 0.0893 0.0655 0.0590 8 0.0446 0.0655 0.0590 9 0.0656 0.0591 10 0.0655 0.0590 11 0.0328 0.0591 12 0.0590 13 0.0591 14 0.0590 15 0.0591 16 0.0295 17 18 19 20 21 1 2 3 20-year 0.0375 0.0722 0.0668 0.0618 0.0571 0.0528 0.0489 0.0452 0.0447 0.0447 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0223 Discrete Compounding; i =9% Single Payment Uniform Series Compound Compound Sinking Amount Present Amount Present Fund Factor Worth Factor Factor Worth Factor Factor To Find F To Find P To Find F To Find P To Find A Given P Given F Given A Given A Given F F/P P/F FIA P/A A/F 1.0900 0.9174 1.0000 0.9174 1.0000 1.1881 0.8417 2.0900 1.7591 0.4785 1.2950 0.7722 3.2781 2.5313 0.3051 1.4116 0.7084 4.5731 3.2397 0.2187 1.5386 0.6499 5.9847 3.8897 0.1671 1.6771 0.5963 7.5233 4.4859 0.1329 1.8280 0.5470 9.2004 5.0330 0.1087 1.9926 0.5019 11.0285 5.5348 0.0907 2.1719 0.4604 13.0210 5.9952 0.0768 2.3674 0.4224 15.1929 6.4177 0.0658 Capital Recovery Factor To Find A Given P A/P 1.0900 0.5685 0.3951 0.3087 0.2571 0.2229 0.1987 0.1807 0.1668 0.1558 4 5 6 7 8 9 10