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Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):     Investment required in equipment $ 39,000   Annual cash inflows  $ 9,600   Salvage value of equipment $ 0   Life of the investment   15 years Required rate of return   10 %     The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.   Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.   The internal rate of return of the investment is closest to:   Multiple Choice   26%   24%   22%   28%

Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):     Investment required in equipment $ 39,000   Annual cash inflows  $ 9,600   Salvage value of equipment $ 0   Life of the investment   15 years Required rate of return   10 %     The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.   Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.   The internal rate of return of the investment is closest to:   Multiple Choice   26%   24%   22%   28%

Managerial Accounting
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 3MAD
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Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):

 

 
Investment required in equipment $ 39,000  
Annual cash inflows  $ 9,600  
Salvage value of equipment $ 0  
Life of the investment   15 years
Required rate of return   10 %
 

 

The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.

 

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.

 

The internal rate of return of the investment is closest to:

 

Multiple Choice
  •  
    26%
  •  
    24%
  •  
    22%
  •  
    28%
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