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Internal Rate of Return Lisun Company produces a variety of gardening tools and aids. The company is examining the possibility of investing in a new production system that will reduce the costs of the current system. The new system will require a cash investment of $4,607,200 and will produce net cash savings of $800,000 per year. The system has a projected life of 9 years. Required: Calculate the IRR for the new production system.

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Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
Publisher: Cengage Learning
ISBN: 9781337115773
BuyFind

Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
Publisher: Cengage Learning
ISBN: 9781337115773
Chapter 12, Problem 24BEA
Textbook Problem

Internal Rate of Return

Lisun Company produces a variety of gardening tools and aids. The company is examining the possibility of investing in a new production system that will reduce the costs of the current system. The new system will require a cash investment of $4,607,200 and will produce net cash savings of $800,000 per year. The system has a projected life of 9 years.

Required:

Calculate the IRR for the new production system.

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Chapter 12 Solutions

Managerial Accounting: The Cornerstone of Business Decision-Making
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