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YouAc€cre trying to determine whether or not to expand your business by building a new manufacturing plant The plant has an installation cost of \$174 million which will be depreciated straight

YouAc€?cre trying to determine whether or not to expand your business by building a new manufacturing plant. The plant has an installation cost of \$17.4 million, which will be depreciated straight-line to zero over its four-year life.

Required:

If the plant has projected net income of \$1,755,000, \$2,115,000, \$1,974,000, and \$1,296,000 over these four years, what is the projectAc€?cs average accounting return (AAR)? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Avg. Accounting Return ____________%

2.

 Consider the following cash flows:
 Year Cash Flow 0 Ac€?o\$ 32,000 1 14,200 2 17,500 3 11,600
 Required: What is the IRR of the above set of cash flows? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
 Internal rate of return %

May 27 2020 View more View Less