3 Check my work Henrie's Drapery Service is investigating the purchase of a new machine for cleaning and blocking drapes. The machine would cost $151,640, including freight and installation. Henrie's estimated the new machine would increase the company's cash inflows, net of expenses, by $40,000 per year. The machine would have a five-year useful life and no salvage value Click here to view Exhibit 138-1 and Exhibit 138-2, to determine the appropriate discount factorts) using table. Required: nts 1. Whet is the machine's internal rate of return? (Round your answer to whole decimal place i.e. 0.123 should be considered as 12%.) 2. Using a discount rate of 10%, what is the machine's net present value? interpret your results. 3. Suppose the new machine would increase the company's annual cash inflows, net of expenses, by only $36,000 per year eBook Under these conditions, what is the internal rate of return? (Round your answer to whole decimal place Le. 0.123 should be considered as 12%.) Print References 1 Internal rate of return 2. Net present value 3. Internal rate of return EXHIBIT 138-1 Present Value of St Periods 4% 5% 6% 7% 8% 9%-- 10% 11% 12% 13% 14% 15% 16% 18% 19% 20% 21% 22% 23% 24% 25 0.962 0.952 0943 0935 0.926 0912 0909 0.901 0.893 0.885 0.877 0.870 0.862 0855 0847 0.840 0833 0826 0.820 0813 0806 0800 2 O.925 0.907 0.890 0873857 0842 0.826 08 1 2 0707 0783 O 769 0.756 0743 0731 0718706 aG04 otn 0672 0661 otto o640 3 0.889 0.864 0.840 0.816 0.794 0.772 0751 0.731 0.712 0.693 0675 0.658 0641 0624 0 609 0.593 0 579 0564 0.551 0537 0524 0512 4 0.855 0.823 0.792 0.763 0.735 0,708 0.683 0659 0636 0613 0592 0.572 0552 0534 0516 0499 0.482 0.467 0451 0437 0423 0410 5 0.822 0.784 0747 0.713 0681 0650 0.621 0593 0567 0543 0519 0497-0476 0456 0.437 0419 0402 0386 0.370 0.355 0.341 0.328 6 0.790 0746 0705 0666 0.630 0596 0 564 0535 0507 0480 0.456 0432 0410 0.390 0.370 0 352 0335 0319 0.303 0.289 0.275 0.262 7 0.760 0.711 0665 0.623 0.583 0.547 0513 0482 0452 0.425 0.400 0.376 0,354 0.333 0.314 0.296 0.279 0.263 0.249 0235 0222 0.210 8 0.731 0677 0627 0.582 0.540 0.502 0.467 0434 0404 0.376 0.351 0.327 0.305 0285 0266 0.249 0233 0.218 0.204 0.191 0.1 0.703 O 645 0592 0544 O 500 460 O 424 O391 O361 0.3 30d 0.284 0263 0243 022S O 209 0194 OTBO 0,67 OSS Oia ana 0 676 0614 O 558 0508 0227 208 0,91 0.176 0162 0.149 0137 0126 0116 0107 g 10 0.463 0422 0386 0352 0322 0295 0270 0247 11-0.650 0585 0527 0.475 O.429 O 388 0350 0317 O 287 0.261 0237 0.215 O 195 0178 0.162 0.148 0.135 0123 112 Oto3 OOS4 0086 12 0625 0557 0497 O 444 0.397 O 356 0 319 0286 0257 o.231 .208 0.187 0.168 0152 0137 0.124 0.112 O.102 092 0083 0076 0069 13 0.601 0.530 0469 0.415 0.368 0.326 0.290 0258 0 229 0204 0.182 0163 0145 0130 0116 0 104 0.093 0.084 0075 0 0es o O 442 O 388 O 340 0299 0263 O232 0 205 0,81 16 , 14, 0.129. 0,11 0099 0 088 0 078 0009 0062 ooss o049 0044 0481 0417 0.362 0315 0.275 0239 0.209 0.183 0.160 0.140 0 123 0.100 0095 0.004 0074 0.065 0057 0051 0.045 0040 001 252 0218 189 0 163 0141 0123 0 107 0093 0081 0071 0062 0054 0047 0042 0036 001200 0513 0.436 0.371 0.317 0270 0.231 0198 0 170 0 146 0 125 0,100 0.003 0000 006 18 0494 O 4 16 O 350 O 296 O 250 O 212 O180 0.153 0130 an, ooos oor, oooo ooso aos 0045 0039 0034 0030 0026 0023 0.060 0062 19 0.475 0.396 0.331 0.277 0 232 0 194 0164 0138 0,116 009 083 0070 0060 0051 0043 0037 0031 0027 0 21 0,439 0359 0294 0.242 0.199 0164 0135 0 112 0093 0077 0064 0053 0044 0037 0031 0026 0.022 0018 0015 0013 0011 0009 22 0422 o 342 0.278 0.226 0184 O 150 0.123 0,01 0063 0,068 OOS6 000 OO38 OO32 O026 O022 OO18 S 0013 oon oces oor 23 0.406 0.326 0.262 0.211 0.170 0138 112 0091 0074 0.060 0049 0040 0033 0027 0022 0018 0015 0012 0010 0009 0007 0006 24 0.390 0.310 0.247 0.197 0.158 0.126 0 102 0082 0066 os3 0043 0035 0028 0023 0019 0015 0.013 0010 0.008 0.007 0.006 o o0s 25 0.375 0295 0233 184 0.146 0 116 o092 a074 .050 047 0.038 0.030 0024 0020.0160013 0.010 0009 0007 0006 0.006 0004 0456 0.377 0.312 0.258 0215 0.178 0,49 0124 o'oa o oe, oor, ooe oost 0041 0017 OO OOE @022 OO 26 O 36 1 0281 0220 172 0135 Ot06 0084 0066 0053 O042 0013 0026 0021 oon ao', oon oos ooo, ooo ewa oo, ear 27 O.347 0.268 O 207 O.161 0 125 0098 0076 0060 O047 0037 0029 .023 0018 0014 .011 0009 0007 0006 0005 0.004 0003 0.002 28 0333 0255 0.196 0.150 0.116 0090 0069 0054 0042 0033 0026 0.020 0016 0012 0010 0008 0.006 0005 0004 0.003 0 002 0.002 29 0.32 0.243 0.185 0.141 .rb7 0.002 0063 0048 0037 0029 0022 0017 0014 0011 0008 0006 0.005 0004 0003 0.002 0002 0.002 30 0.308 0231 0.174 0.131 0.099 0.075 0057 0044 0033 0026 0020 0015 0012 0009 0 007 0005 0.004 0003 0003 0002 0002 0001 0208 0.142 0.097 0.067 0.046 0.032 0022 oo 15o,011 0008 0005 0004 0003 0002 0001 0001 0.001 0000 0000 0000 0000 0000 40 1 1 EXHIBIT 138-2 Present Value of an Annuity of $1 in Arrears1 ods 4% 5% 6% 7% 8% /, 9% 10% 11% 12% 13% 16% 15% 17% 18% 19% 20% 21% 22% 23% 24% 25% 901 0.893 0.885 0.877 0870 0862 0855 0.847 0.840 0.833 0826 0.820 0 813 0.806 0.800 246 2210 2.174 2140 2.106 2074 2042 2011 1.981 1.952 14% 0.962 0952 0943 0.935 0926 0917 0909 o 2 1.886 1.859 1833 1.808 1.783 1.759 1736 1.713 1690 1668 1.647 1626 1.605 1.585 1.566 1.547 1.528 1.509 1.492 1.474 1.457 1.440 3 2.775 2.723 2.673 2624 2577 2.531 2487 2.444 2.402 2 361 2.322 2.283 22 4 3.630 3.546 3.465 3.387 3312 3.240 3.170 3.102 3.037 2974 2.914 2.855 2798 2743 2.690 2639 2.589 2.540 2.494 2.448 2.404 2.362 5 4.452 4.329 4.212 4100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3352 3274 3.199 3.127 3.058 2.991 2.926 2.864 2.803 2745 2689 6 5242 5.076 4.917 4767 4623 4.486 4355 4.231 4.111 3.998 3.889 3.784 3685 3589 3.498 3.410 3326 3.245 3.167 3.092 3020 2951 7 6002 5.786 5.582 5389 5.206 5033 4868 4.712 4564 4.423 4.288 4 160 4.039 3.922 3.812 3.706 3.605 3.508 3.416 3.327 3.242 3.161 8 6.733 6.463 6210 5971 5.747 5535 5.335 5.146 4968 4.799 4639 4.487 4 344 4.207 4078 3954 3837 3726 3619 3.518 3421 332 9 7435 7.108 6.802 6515 6.247 5.995 5.759 5537 5328 5.132 4946 4.772 4607 4.451 4 303 4.163 4.031 3.905 3.786 3.673 3566 3.463 10 8.111 7.722 7.360 7024 6.710 6418 6.145 5.889 5650 5.426 5216 5019 4 833 4659 4.494 4 339 4.192 4054 3923 3.7993 571 11 8.760 8306 7.887 7.499 7.139 680S 6495 207 5938 5 687 5453 5234 5029 4836 4656 4486 4327 41m ao35 3902 3776 3656 12 9385 8.863 8.384 7.943 7.536 7.161 6.814 6492 6.194 5.918 5.660 5421 5.197 4988 4.793 4611 4439 4.278 4.127 3.985 3.851 3.725 13 9986 9.394 8.853 8.358 7.904 7487 7.103 6.750 6.424 6.122 5842 5583 5.342 5.118 4910 4715 4533 4362 4.203 4053 3.912 14 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.982 6.628 6.302 6002 5.724 5468 5.229 5.008 4.802 4611 4432 4.265 4.108 3.962 3.824 15 11.118 10.380 9.712 9.108 8.559 8061 7.606 7.191 6.811 6462 6142 5847 5575 5.324 5.092 4876 4675 4489 4.315 4.153 4.001 3859 938 4730 4536 4357 4.189 4.033 3 16 11.652 10.838 10.106 9.447 8.851 8313 7.824 7.379 6 974 6604 6265 5.954 5668 5.405.5.162 4 274 10.477 9763 9.122 8544 8022 7.549 7 120 6729 6 373 6047 5749 5475 5.222 4990 4775 4576 4391 4 219 4059 3910 8.756 8.201 7.702 7.250 6 840 6 467 6.128 5818 5534 5.273 5033 4812 4 608 4419 4.243 4080 3.928 8.950 8.365 7.839 7 366 6.938 6550 6 198 5.877 5584 5316 5070 4843 4 635 4 442 4263 4097 3942 259 5.929 5628 5353 5 101 4870 4657 4 460 4.279 4 110 3954 18 12659 11.690 10.828 10059 9372 19 13.134 12.085 11.158 10.336 9.604 20 13.590 12.462 11.470 10 594 9.818 9,129 8514 7.963 7.469 7 025 6.623 6 8.649 8075 7.562 7.102 6687 6.312 5.973 5665 5.384 5.127 4891 4675 4476 4 292 4121 3963 21 14.029 12.821 11.764 10.836 10017 9292 22 14.451 13.163 12.042 11.061 10.201 9442 8.772 8.176 7645 7.170 6.743 6359 601 23 14857 13.489 12 303 11.272 10.371 9 580 8.883 8 266 7,718 7.230 6.702 6.399 6.044 5.723 5432 5 167 24 15.247 13.799 12550 11.4 25 15.622 14.094 12.783 11654 10675 9823 9077 8.422 7.943 7 330 6.873 6 464 6097 5766 5.467 5 195 494 5 149 4 909 4.690 4.488 4.302 4.130 3.970 4925 4.703 4.499 4311 4.137 3976 4.507 4.318 4.143 3.981 8 4.721 4514 4 323 4 147 3985 1 3.988 3 4 469 10.529 9707 8.985 8.348 7784 7.283 6.835 6.434 6073 5.746 5451 5 182 4937 471 26 15983 14.375 13003 11.826 10 810 9929 9 161 8488 7.896 7 372 6906 6491 6118 5783 5480 5.206 4956 4728 4 520 4.328 4 15 27 16.330 14 643 13211 11.987 10935 10.027 9.237 8548 7.943 7409 6935 6514 6.136 5798 5.492 5215 4 964 4734 4.524 4.332 4 154 3990 28 16.663 14.898 13.406 12.137 J1.051 10 116 9.307 8602 7984 7441 6 951 6534 6 152 5810 5502 5.223 4.970 4.739 4528 4.335 4.157 3992 29 16.984 15.141 13.591 12.278 11.158 10.198 9.370 8 650 8022 7.470 6983 6551 6.166 5.820 5510 5229 4 975 4743 4531 4.337 4.159 3.994 30 17.292 15.372 13765 12.409 11.258 10.274 9.427 8694 8055 7 496 7003 6566 6.177 5.829 5517 5235 4979 4.746 4534 4.339 4.160 3.995 42 6233 5871 5548 525B 4997 4760 4544 4347 4166 1999 19.793 17.159 15.046 13.332 11.925 10.757 9.779 8.951 8.244 7634 7.105 40