give the detailed answer please. your firm is contemplating the purchase of a new $791,000 computer based order entry system. the system will be depreciated
give the detailed answer please.
your firm is contemplating the purchase of a new $791,000 computer based order entry system. the system will be depreciated straight line to zero over it's seven year life.It will be worth of $57000 at the end of that time . You will save $177000 before taxes per year in order processing costs, and you will be able to reduce working capital by $52000 at the beginning of the project. working capital will revert back to normal at the end of the project. if the tax rate is 40% what is the IRR for this project?
I have written the whole question just in case I have missed some information in the picture.
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