Kamila Company is considering whether to invest in a piece of equipment that req

Question

Kamila Company is considering whether to invest in a piece of equipment that requires an investment of $40,000 today. The project will provide net cash inflows of $10,000 at the end of each year for five years, and it will have a salvage value of $12,000 at the end of five years. Calculate the internal rate of return. Ignore income taxes. Kamila Company is considering whether to invest in a piece of equipment that requires an investment of $40,000 today. The project will provide net cash inflows of $10,000 at the end of each year for five years, and it will have a salvage value of $12,000 at the end of five years. Calculate the internal rate of return. Ignore income taxes.

Explanation / Answer

(by excel IRR function)

year cash flow 0 -40000 1 10000 2 10000 3 10000 4 10000 5 22000 IRR 15%

Related Questions

Navigate

• Browse (All)
• Browse K
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.