Krauth Company purchased a machine for $119,000. The machine has a life of seven years with no
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Question:
Krauth Company purchased a machine for $119,000. The machine has a life of seven years
with no salvage value. It is expected that the machine will generate annual net cash inflows
of $28,000 per year over its useful life. Assume Krauth Company employs a cost of capital
of 10% on all capital investment projects.
The internal rate of return (IRR) on the machine is closest to:
9%
10%
12%
14%
15%
16%
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