(a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals. (b) The hurdle rate is 9%. Should the company invest in this project on the basis of internal rate of return? Complete this question by entering your answers in the tabs below. Required A Required B What is the internal rate of return of this investment? Present value factor Internal rate of return %

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Perez Company is considering an investment of $20,957 that provides net cash flows of $6,900 annually for four years.
(a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1)
Note: Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.
(b) The hurdle rate is 9%. Should the company invest in this project on the basis of internal rate of return?
Complete this question by entering your answers in the tabs below.
Required A
Required B
What is the internal rate of return of this investment?
Present value factor
Internal rate of return
%
Required A
Required B
Transcribed Image Text:Perez Company is considering an investment of $20,957 that provides net cash flows of $6,900 annually for four years. (a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals. (b) The hurdle rate is 9%. Should the company invest in this project on the basis of internal rate of return? Complete this question by entering your answers in the tabs below. Required A Required B What is the internal rate of return of this investment? Present value factor Internal rate of return % Required A Required B
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