Hennie's Drapery Service is investigating the purchase of a new machine for cleaning and blocking drapes. The machine would cost $102,990, including freight and installation. Henrie's estimated the new machine would increase the company's cash inflows, net of expenses, by $30,000 per year. The machine would have a five-year useful life and no salvage value. Click here to view Exhibit 138.1 and Exhibit 13B-2. to determine the appropriate discount factor(s) using table. Required: 1. What is the machine's internal rate of return? (Round your final answer to the nearest whole percentage.) 2. Using a discount rate of 14%, 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 $27,170 per year Under these conditions, what is the intemal rate of return? (Round your final answer to the nearest whole percentage.) % 1. Internal rate of return 2 Net present value 3 Internal rate of return 9 EXHIBIT 138-1 Present Value of $t pot Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 1 0.962 0.952 0.943 0.935 0.926 0917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.926 0.820 0.813 0.806 0.800 2 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.783 0.769 0.756 0.743 0.731 0.718 0.706 0.694 0,683 0.672 0661 0.650 0.640 3 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0675 0.658 0.641 0.624 0.609 0.593 0.579 0.564 0.551 0.537 0.524 0512 4 0855 0.823 0.792 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0572 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.437 0.423 0.410 5 0.822 0.784 0.747 0.713 0681 0.650 0.621 0.593 0567 0543 0.519 0.497 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0.328 6 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0.352 0.335 0.319 0 303 0.289 0.275 0.262 7 0.750 0.711 0.665 0.623 0.583 0 547 0.513 0.482 0.452 0.425 0.400 0.376 0.354 0.333 0.314 0.296 0.279 0.263 0 249 0.235 0.222 0.210 B 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0.351 0.327 0.305 0.285 0.266 0.249 0 233 0.218 0.204 0.191 0.179 0.168 9 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0333 0.308 0.284 0.263 0.243 0.225 0.209 0.194 0.180 0.167 0.155 0.144 0.134 10 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 0 270 0.247 0.227 0.208 0.191 0.176 0.162 0.149 0.137 0.126 0.116 0.107 11 0.650 0.585 0.527 0.475 0.429 0.388 0 350 0317 0.287 0.261 0.237 0.215 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.103 0.094 0.086 12 0625 0.557 0.497 0.444 0 397 0.356 0.319 0.286 0257 0231 0.208 0.187 0.168 0.152 0.137 0.124 0.112 0.102 0.092 0083 0.076 0.069 13 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0229 0.204 0.182 0.163 0.145 0.130 0.116 0.104 0.093 0.084 0.075 0.068 0.061 0.055 14 0.577 0.505 0.442 0.388 0.340 0.299 0 263 0232 0205 0.181 0.160 0.141 0.125 0.111 0.099 0.008 0.078 0.069 0.062 0.055 0.049 0.044 15 0 555 0.481 0.417 0.362 0.315 0.275 0 239 0209 0.183 0.160 0.140 0.123 0.108 0.095 0.04 0.074 0,065 0.057 0.051 0.045 0.040 0.035 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0.163 0.141 0.123 0.107 0.093 0.081 0.071 0.062 0.054 0.047 0.042 0.035 0.032 0.028 17 0:513 0.436 0.371 0.317 0.270 0.231 0.19 0.170 0.146 0.125 0.08 0.093 0.080 0.069 0.060 0.052 0.045 0.039 0034 0.030 0.026 0.023 18 0.494 0.416 0 350 0.296 0.250 0212 0.180 0153 0.130 0 111 0.095 0.081 0.069 0.059 0.051 0.044 0.038 0.032 0.028 0.024 0.021 0.018 19 0.475 0.396 0331 0 277 0 232 0.194 0.164 0.138 0.116 0098 0083 0.070 0.060 0.051 0.043 0.037 0.031 0.027 0023 0.020 0.017 0.014 20 0:456 0 377 0312 0 258 0215 0.178 0149 0124 0.104 0.087 0.073 0.061 0.051 0.043 0.037 0.031 0.025 0.022 0.019 0,015 0.014 0.012 21 0439 0.359 0.294 0 242 0.199 0.154 0.135 0.112 0.093 0077 0064 0.053 0.044 0.037 0,031 0.025 0.022 0.018 0015 0.013 0011 0.000 22 0.422 0.342 0.278 0 226 0.184 0.150 0.123 0.101 0083 0068 0056 0.046 0038 0.032 0.026 0022 0018 0.015 0.013 0011 0.009 0.007 23 0.406 0.326 0.262 0211 0.170 0.138 0 112 0091 0074 0 060 0049 0.040 0.033 0.027 0022 0018 0.015 0012 0010 0.009 0.007 0.006 24 0390 0.310 0.247 0.197 0.158 0.126 0.102 0082 0.066 0053 0043 0035 0.028. 0.023 0.019 0015 0013 0010 0.008 0.007 0.006 0.005 25 0.375 0.295 0.233 0.184 0.146 0.116 0.092 0074 0059 0.047 0038 0.030 0.024 0.020 0.016 0013 0.010 0.009 0.002 0.006 0.005 0.004 25 0 361 0281 0.220 0172 0.135 0.106 0084 0066 0053 0042 0.033 0.026 0.021 0.017 0.014 0011 0009 0.007 0006 0.005 0.004 0.003 6 347 0268 0.207 0.161 0.125 0.098 0.076 0060 0047 0037 0.029 003 0018 0.014 0011 0000 0002 0.006 0005 0004 003 0002 28 0333 0.255 0 196 0.150 0.116 0000 0069 0054 0042 0033 0026 0020 0010 0012 0010 008 0006 0.005 0004 0000 0002 0.002 0321 0243 0.185 0 141 0.107 0002 0.063 0048 0037 0.029 0022 0017 0.014 0.011 0.008 0.005 0.005 0004 0.003 0.002 0.002 0.002 30 0.308 0.231 0.374 0131 0099 0015 0.057 0044 0033 0026 00200015 0012 0.009 0.007 0.005 004 0003 0003 0002 002 0001 40 0208 0.142 0.097 0.067 004 0032 0.022 0015 0011 0.008 0.005 0.004 0.003 0.002 0.001 0001 0001 0000 0000 0000 0000 0.000 EXHIBIT 133-2 Present Value of an Annuity of $1 in Arres Periods 1 2 3 4 5 6 7 8 9 10 12 13 14 15 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 0.962 0952 0943 0.935 0.926 0.917 0.909 0 901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0826 0.820 0.813 0,806 0.800 1.886 1.859 1833 1.808 1.783 1.759 1.736 1.713 1690 1668 1647 1.626 1.605 1.585 1.566 1547 1.528 1.509 1.492 1.474 1.457 1.440 2.775 2.723 2673 2624 2577 2531 2.487 2.444 2.402 2361 2322 2283 2246 2.210 2.174 2.140 2.106 2.074 2042 2011 1.981 1952 3.630 3.546 3.465 3.387 3312 3.240 3.170 3.102 3.037 2 974 2.914 2.855 2.798 2 743 2.690 2.639 2.589 2.540 2.494 2.448 2.404 2.362 4.452 4329 4212 4.100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3.352 3.274 3.199 3.127 3.058 2.991 2926 2864 2803 2.745 2,689 5.242 5.076 4.917 4 767 4.623 4.486 4 355 4 231 4.111 3.998 3.889 3.784 3.685 3.589 3.498 3.410 3.326 3.245 3.167 3.092 3.020 2.951 6.002 5.786 5.582 5389 5206 5.033 4.868 4.712 4.564 4423 4288 4.160 4,039 3922 3.812 3.706 3.605 3.508 3.416 3327 3.242 3.161 6.733 6.463 6210 5.971 5747 5.535 5.335 5.146 4 968 4.799 4639 4.487 4 344 4.207 4.078 3.954 3837 3.726 3.619 3518 3.421 3.329 7435 7.108 6.802 6.515 6.247 5.995 5.759 5537 5.328 5.132 4946 4.772 4.607 4.451 4.303 4.163 4031 3 905 3.786 3.673 3.566 3.463 8.111 7722 7.360 7024 6710 6.418 6.145 5.889 5.650 5.426 5 216 5.019 4.833 4.659 4.494 4339 4.192 4.054 3.923 3.799 3.682 3571 8.760 8306 7 887 7.499 7.139 6 805 6.495 6.207 5.938 5687 5.453 5.234 5029 4.836 4 656 4.486 4.327 4.177 4.035 3.902 3.776 3.656 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.492 6.194 5918 5660 5.421 5 197 4988 4.793 4611 4.439 4.278 4.127 3.985 3.851 3.725 9.986 9394 8.853 8.358 7.904 7.487 7 103 6.750 6 424 6.122 5.842 5583 5.342 5 118 4.910 4715 4533 4.362 4203 4.053 3.912 3.780 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.982 6.628 6 302 6002 5724 5 468 5 229 5008 4.802 4611 4.432 4 265 4.108 3.962 2824 11.118 10 3809712 9.108 8.559 8.061 7.606 7.191 6811 6.462 6.142 5.847 5575 5.324 5092 4.876 4.675 4.489 4 315 4.153 4001 3859 11652 10 838 10.106 9.447 8851 8.313 7.824 7 379 6.974 6,604 6 265 5 954 5.668 5 405 5.162 4 938 4.730 4.536 4 357 4.189 4.033 3.887 12 166 11 274 10 477 9763 9.122 8544 8.022 7549 7.120 6.729 6373 6047 5.749 5 475 5222 4 990 4775 4576 4 391 4219 4059 3910 12 659 11690 10828 10 059 9.372 3.756 8 201 7.702 7.250 6 840 6.467 6.128 5.818 5 534 5 273 5033 4812 4.608 4.419 4.243 4.080 3928 13.134 12 08 11 158 10 336 9.604 8.950 8.365 7839 7366 6938 6.550 6.198 5877 5584 5 316 5070 4843 4.635 4 442 4.263 4097 3942 12590 12.462 11.470 10 594 9.818 9.129 8.514 7963 7 469 7.025 6623 6259 5.929 5628 5353 5 101 4870 4657 4.460 4 279 4.110 3954 14029 12821 11.764 10 836 10017 9292 8 649 8075 75627 102 6687 6312 5,973 5665 5 384 5 127 4.891 4675 4 476 4 292 4121 3 963 14.451 13 163 12.042 11 061 10.2019.442 8.772 B 1767645 7.170 6.743 6 359 6 011 5.696 5.410 5149 4900 4690 4488 4302 4130 3970 14 B57 13.489 12 303 11272 10 371 9580 8883 8 266 7718 7230 6.792 6 399 6 044 5723 5 432 5 167 4.925 4.703 4499 4 311 4 137 3.926 15 247 13 799 12 550 11469 10.529 9.707 8.985 8 348 7784 7.283 6835 6.434 6073 5746 5.451 5.182 4937 4713 4.507 4318 4143 3 981 15.622 14094 1273 11654 10675 9.8239077 8 422 7843 7 330 6873 6 464 6.097 5 756 5467 5.195 4 948 4721 4514 323 4 147 985 15983 14 375 13003 11 826 10 8109,929 9 161 8488 7.896 7372 6.90 6,491 6.11B 5783 5 480 5 206 4 956 4728 4520 4.328 4 151 3988 16. 310 14641 13211 11937 10.935 10027 9.237 8548 7943 7.409 6 935 6514 6.136 5.798 5.499 5 215 4964 4734 4.524 4.332 41543990 16.663 1498 13 405 12137 11051 16 116 9107 8 602 79847 441 6961 6534 152 5810 5 502-52234970 4739 4528 4 335 4191992 16.984 15 145 13591 12278 11 153 10.1989 370 3650 80227.470 6983 6551 6.166 5820 5510 5229 4975 4 743 45314 337 4 159 3904 17292 15 172.11765 12.409 11 2510 274 9 427.8694 8055 7 495 700) 6 566 6.177 5829 5517 5235 4 970 4745 4534 4339 4160 3.995 19.793 17 159 15 046 12 32 11 925 70 757 779.3951 8247636 7105 6642 6223 5871 5548 5258 4.997 47604544 4.1474 166 3009 16 17 18 19 20 21 22 23 24 25 25 27 28 20 40