Columbia University Operations And Supply Chain Management Assignment Help - Henrie’s Drapery

Question - Henrie’s Drapery Service is investigating the purchase of a new machine for cleaning and blocking
drapes. The machine would cost $130,400, including freight and installation. Henrie’s has estimated
that the new machine would increase the company’s cash inflows, net of expenses, by 525,000 per
year. The machine would have a 10-year useful life and no salvage value.
Required:
(Ignore income taxes.)
1. Compute the machine’s internal rate of return to the nearest whole percent.
2. Compute the machine’s net present value. Use a discount rate of 14%. Why do you have a zero
net present value?
3. Suppose that the new machine would increase the company’s annual cash inflows, net of
expenses, by onl ...Read More y $22,500 per year. Under these conditions, compute the internal rate of return to the
nearest whole percent. ...Read Less

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