A project is estimated to cost $328,880 and provide annual net cash flows of $80,000 for six years. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 0.909 0.943 0.893 0.870 0.833 1.690 1.833 1.736 1.626 1.528 2.283 2.673 2.487 2.402 2.106 4 3.465 3.170 3.037 2.855 2.589 4.212 3.791 3.605 3.352 2.991 3.326 4.917 4.355 4.111 3.784 5.582 4.868 4.564 4.160 3.605 6.210 3.837 8. 5.335 4.968 4.487 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Determine the internal rate of return for this project, using the Present Value of an Annuity of $1 at Compound Interest table shown above. % 3.

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 4BE: Internal rate of return A project is estimated to cost 463,565 and provide annual net cash flows of...
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A project is estimated to cost $328,880 and provide annual net cash flows of $80,000 for six years.
Present Value of an Annuity of $1 at Compound Interest
Year
6%
10%
12%
15%
20%
0.909
0.943
0.893
0.870
0.833
1.690
1.833
1.736
1.626
1.528
2.283
2.673
2.487
2.402
2.106
4
3.465
3.170
3.037
2.855
2.589
4.212
3.791
3.605
3.352
2.991
3.326
4.917
4.355
4.111
3.784
5.582
4.868
4.564
4.160
3.605
6.210
3.837
8.
5.335
4.968
4.487
6.802
5.759
5.328
4.772
4.031
10
7.360
6.145
5.650
5.019
4.192
Determine the internal rate of return for this project, using the Present Value of an Annuity of $1 at Compound Interest table shown
above.
%
3.
Transcribed Image Text:A project is estimated to cost $328,880 and provide annual net cash flows of $80,000 for six years. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 0.909 0.943 0.893 0.870 0.833 1.690 1.833 1.736 1.626 1.528 2.283 2.673 2.487 2.402 2.106 4 3.465 3.170 3.037 2.855 2.589 4.212 3.791 3.605 3.352 2.991 3.326 4.917 4.355 4.111 3.784 5.582 4.868 4.564 4.160 3.605 6.210 3.837 8. 5.335 4.968 4.487 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Determine the internal rate of return for this project, using the Present Value of an Annuity of $1 at Compound Interest table shown above. % 3.
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