Question

In: Accounting

Calculate? (a) net present? value, (b) payback? period, (c) discounted payback? period, and? (d) internal rate...

Calculate? (a) net present? value, (b) payback? period, (c) discounted payback? period, and? (d) internal rate of return.

Cost of the equipment

$166,000

Reduced labor costs

$45,000

Estimated life of the equipment

10

years

Terminal disposal value

?$0

?After-tax cost of capital

12

?%

Tax rate

20

?%

Assume depreciation is calculated on a? straight-line basis for tax purposes. Assume all cash flows occur at? year-end except for initial investment amounts.

Calculate? (a) net present? value, (b) payback? period, (c) discounted payback? period, and? (d) internal rate of return.

Solutions

Expert Solution

ekkarill92 answered 10 months ago
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