Question: Calculate the Internal Rate of return. Ncube Ltd is considering buying a machine and has presented the following Information: Purchase Price R 130 000.00 Expected

Ncube Ltd is considering buying a machine and has presented the following Calculate the Internal Rate of return.

Ncube Ltd is considering buying a machine and has presented the following Information: Purchase Price R 130 000.00 Expected Economic life minimum required rate of return net cash inflow rate of taxation depreciation is calculated using the straight-line method 10 Years 12% R25 000.00 30%

Step by Step Solution

★★★★★

3.47 Rating (157 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

To calculate the internal rate of return IRR of the machine we need to ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Calculate the internal rate of return (IRR) and the net present value (NPV) of a project with a 15% required return (WACC = 15%) and an initial investment of $3,500,000. The project has a life of 10...

Calculate the internal rate of return on the following set of cash flows, according to the economic interpretation of internal rate of return near the end of Section F.3. Assume that the opportunity...

Calculate the internal rate of return on the following set of cash flows: t0: ............................-1,000 t1: ............................100 t2: ............................900 t3:...

Jack Turner is your client. He recently graduated from College and is considering purchasing a business. While in College, Jack drove a cab to pay his way through school. Jack learned a great deal...

The following table presents the initial cash outlay and cash flow projections for a new line of digital cameras that DigiCam, Inc., is evaluating. Initial cash outlay ....... $2,350,000 Net pretax...

9-4B. (NPV; PI, and IRR calculations) Gecewich, Inc., is considering a major expansion of its product line and has estimated the following cash flows associated with such an expansion. The initial...

In a zoo, a new fish basin is to be installed. A capital expenditure of 150,000 is necessary. The period of use is assumed to be 30 years. Due to the increased attraction of the zoo, the number of...

Nina Roberts has the opportunity to invest in a timber forest. She would have to invest $100,000. Revenues of $20,000 per year are projected for 20 years. However, these revenues will not begin...

Perez and Soto (P&S) is a partnership that owns a small company. It is considering two alternative investment opportunities. The first investment opportunity will have a five-year useful life, will...

Benjamin Box Corporation is considering adding another machine for the manufacture of corrugated cardboard. The machine would cost $700,000. It would have an estimated life of 6 years and no salvage...

How much time does an algorithm using 250 operations need if each operation takes these amounts of time? a) 106 s b) 109 s c) 1012 s

Truly Berhad has a 100%-owned foreign subsidiary, which has a carrying value at a cost of RM25 million. It sells the subsidiary on 31 December 2019 for $45million. As at 31 December 2019, the credit...

Factorise each of the following expressions completely. (a) (b) 3ax+28by+4ay + 21bx 12cy+20c-15-9y (c) dy+fy-f-d (d) 3x+6xy-4-8y (e) 2xy-8x+12-3y (f) 5xy-25x+50x-10y (g) -5-5xy + xy (h) ky+hy-hx-ky

The item for medical practice of Linda Denny , MD are listed below Retained earnings October 1 -15000 Common stock-30,000 Accounts payable -6,000 Equipment-29,000 Service revenue-23,000 Dividends-...

A new company, is being established to manufacture and sell an electronic tracking device: the Trackit. The owners are excited about the future profits that the business will generate. They have...

Back in the old days, a railway owned tracks that ran between two small cities. Several farms were located alongside the tracks. The steam engines used in those days sometimes threw off sparks, which...

Fill in the blanks for each of the following independent cases. Unit Unit Variable Number Total Total Selling Price Operating Costs of Units Contribution Fixed Operating Income Case Sold Margin Costs...

Which of the following statements is false? A. When firms raise new capital from investors, they do so primarily by issuing debt. B. In Modigliani and Miller's setting of perfect capital markets,...

Based on the Discussion "Tips on How to Do Well" (see Content--> Class Management), what is one thing you can do to improve this semester

Suppose the cost of electricity is expected to increase at the rate of 6% per year. How will this new information change your recommendation? Use the original eight-year study period in your analysis.

A large mudslide caused by heavy rains will cost Sabino County $1,000,000 per occurrence in lost property tax revenues. In any given year, there is one chance in 100 that a major mudslide will occur....

A company produces and sells a consumer product and is able to control the demand for the product by varying the selling price. The approximate relationship between price and demand is where p is the...

23. If a statistician wishes to estimate a parameter d subject to a loss function which is linear with k0 = 2kU) and his distribution of 6 is an exponential distribution with X = 4, what is the...

11. Suppose that you are offered a choice between Bets A and B: Bet A: You win $1,000,000 with certainty (that is, with probability 1). Bet B: You win $5,000,000 with probability .1 You win...

6. What is the primary disadvantage of decision-making rules such as maximin, maximax, and minimax loss?