Briar Corporation is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net cash flow of $$201,000.$ The equipment will have an initial cost of $$1,201,000$ and an $8-$year useful life. The salvage value of the equipment is estimated to be $$201,000.$ Briar$$s cost of capital is $6\%.($Future Value of $$1,$ Present Value of $$1,$ Future Value Annuity of $$1,$ Present Value Annuity of $$1)$

Note: Use appropriate factor from the PV tables.

Required:

What is the accounting rate of return?

What is the payback period?

What is the net present value?

What would the net present value be with a $13\%$ cost of capital?

Based on the NPV calculations, what would be the equipment's internal rate of return?