Sunday, February 10, 2013

Brown Corporation recently purchased a new machine for $339,013.20 with a ten-year life

ACCOUNTING

Multiple Choice

Brown Corporation recently purchased a new machine for $339,013.20 with a ten-year life. The old equipment has a remaining life of ten years and no disposal value at the time of replacement. Net cash flows will be $60,000 per year. What is the internal rate of return?

a. 12%

b. 16%

c. 20%

d. 24%

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