Viera Corporation is considering investing in a new facility. The estimated cost

Question

Viera Corporation is considering investing in a new facility. The estimated cost of the facility is $1,818,566. It will be used for 12 years, then sold for $715,400. The facility will generate annual cash inflows of $373 400 and will need new annual cash outflows of $155,000. The company has a required rate of return of 7% ac Calculate the internal rate of return on this project. (Round answer to O decimal place, e.g. 125) Internal rate of return is [ Whether the project should be accepted The project L- ! be accepted. motonen . a

Explanation / Answer

IRR =9.00%

The Project should be accepted as IRR is Above Required rate of return.

NPER 12 PMT (373400-155000) PV -1818566 =RATE(12,(373400-155000),-1818566,715400) 9.00%

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