Internal rate of return General Information Systems, Inc. is evaluating a proposal to buy new laptop computers
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Internal rate of return General Information Systems, Inc. is evaluating a proposal to buy new laptop computers for its field staff. The cost of the new computers for the senior staff would be $62,903. In addition, the company would have to pay a 5 percent sales tax on the purchase and spend $4,000 for training and manuals. The new computers have an expected useful life of 5 years and should speed up processing time enough to generate $22,400 per year additional billings. The computers will have no salvage value. The company does not accept investment proposals that yield less than a 15 percent rate of return.
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