Computing an Internal Rate of Return (with a Present Value of an Annuity of $1 Table) :

Dr. Whitten has decided to purchase equipment that has a cost of $60,000 and will produce a pretax net cash inflow of $30,000 per year over its estimated useful life of six years. The equipment will have no salvage value and will be depreciated by the straight-line method. The tax rate is 50 percent. Determine Dr. Whittens approximate after-tax internal rate of return. You are required to use the Present Value of an Annuity of $1 Table (p. 145) to solve this problem and report the table factor you identified.

Show work.

PV = 11.391