A company has a project with a 5-year life, requiring an initial investment of $227,600, and is expected to yield annual cash flows of $57,000. What is the internal rate of return? IRR Investment Factor Annual cash flows "IRR Factor: This is the factor which Investment: This is the present you'll use on the table for the value of cash outflows associated present value of an annuity of $1 with a project. If all of the Annual Cash Flows: dollar in order to find the investment is up front at the This is the amount of percentage which corresponds to beginning of the project, the present cash flows to be the internal rate of return. value factor is 1.000. received annually as a result of the project. Calculation Steps Present Value of an Annuity of $1 at Compound Interest. X IRR Factor = 57,000 X , rounded to 6 decimalsA company has a project with a 5-year life, requiring an initial investment of $227,600, and is expected to yield annual cash flows of $57,000. What is the internal rate of return? IRR = Investment Factor Annual cash flows BIRR Factor: This is the factor which Investment: This is the present you'll use on the table for the value of cash outflows associated present value of an annuity of $1 Annual Cash Flows: with a project. If all of the dollar in order to find the investment is up front at the This is the amount of percentage which corresponds to beginning of the project, the present cash flows to be the internal rate of return. value factor is 1.000. received annually as a result of the project. Calculation Steps Present Value of an Annuity of $1 at Compound Interest. X IRR Factor = X , rounded to 6 decimals $ 57,000