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Henries Drapery Service is investigating the purchase of a new machine for cleaning and blocking drapes. The machine would cost $137,320, including freight and installation, Henries estimated the new machine would increase the company’s
Required:
1. What is the machine’s internal rate of return to the nearest whole percent?
2. Using a discount rate of 14%, what is the machines net present value? Interpret your results.
3. Suppose the new machine would increase the company’s ua1 cash inflows, net of expenses, by only $37,150 per year. Under these conditions, what is the internal rate of return to the nearest whole percent?
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Introduction To Managerial Accounting
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- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College