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Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of trenching machines. The outlay required is $598,122. The NC equipment will last five years with no expected salvage value. The expected after-tax cash flows associated with the project follow: Year      Cash Revenues      Cash Expenses 1 $1,500,000 $1,300,000 2 1,500,000 1,300,000 3 1,500,000 1,300,000 4 1,500,000 1,300,000 5 1,500,000 1,300,000 Required: Compute the Investment's Internal Rate of return. Enter as a percent. If required, round your answer to the nearest whole percent. IRR = fill in the blank, %

Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of trenching machines. The outlay required is $598,122. The NC equipment will last five years with no expected salvage value. The expected after-tax cash flows associated with the project follow: Year      Cash Revenues      Cash Expenses 1 $1,500,000 $1,300,000 2 1,500,000 1,300,000 3 1,500,000 1,300,000 4 1,500,000 1,300,000 5 1,500,000 1,300,000 Required: Compute the Investment's Internal Rate of return. Enter as a percent. If required, round your answer to the nearest whole percent. IRR = fill in the blank, %

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of trenching machines. The outlay required is $598,122. The NC equipment will last five years with no expected salvage value. The expected after-tax cash flows associated with the project follow:

Year      Cash Revenues      Cash Expenses
1 $1,500,000 $1,300,000
2 1,500,000 1,300,000
3 1,500,000 1,300,000
4 1,500,000 1,300,000
5 1,500,000 1,300,000

Required:

Compute the Investment's Internal Rate of return. Enter as a percent. If required, round your answer to the nearest whole percent.
IRR = fill in the blank, %

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