The internal rate of return method is used to analyze a $831,500 capital investment proposal with annual net cash flows of $250,000 for each of the six years of its useful life.a. Determine a present value factor for an annuity of $1, which can be used in determining the internal rate of return. Carry your answer out to three decimal places.b. Based on the factor determined in (a) and the portion of the present value of an annuity of $1 table presented below, determine the internal rate of return for the proposal.Year10%15%20%10.9090.8700.8331.7361.6261.52832.4872.2832.10643.1702.8552.58953.7913.3532.99164.3553.7853.32674.8684.1603.605%

he internal rate of return method is used to analyze a $831,500 capital investment Determine a present value factor for an annuity of $1, which can be used in dete Based on the factor determined in (a) and the portion of the present value of an Year 10% 15% 20% 1 0.909 0.870 0.833 2 1.736 1.626 1.528 3 2.487 2.283 2.106 4 3.170 2.855 2.589 5 3.791 3.353 2.991 6. 4.355 3.785 3.326 4.868 4.160 3.605

he internal rate of return method is used to analyze a $831,500 capital investment Determine a present value factor for an annuity of $1, which can be used in dete Based on the factor determined in (a) and the portion of the present value of an Year 10% 15% 20% 1 0.909 0.870 0.833 2 1.736 1.626 1.528 3 2.487 2.283 2.106 4 3.170 2.855 2.589 5 3.791 3.353 2.991 6. 4.355 3.785 3.326 4.868 4.160 3.605

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 16E

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