Partial Income Statement At the End of 2019 Sales revenue Cost of goods sold Fixed costs Selling, general, and administrative expenses Interest expense Depreciation $350,200 $142,000 $43,000 $27,800 $10,000 $45,800 Tax rate 40% Partial Balance Sheet 2018 ASSETS Cash Accounts receivable LIABILITIES $16,100 Notes payable $27,800 Accounts payable $47,900 Long-term debt $367,800 OWNERS' EQUITY $143,000 Accumulated retained earnings $81,900 Common stock $14,200 $18,800 $189,900 Inventories Gross Fixed assets Accumulated depreciation (-) Intangible assets $131,900 Partial Balance Sheet 2019 ASSETS Cash and marketable securities Accounts receivable Inventories LIABILITIES $26,000 Notes payable $19,200 Accounts payable $53,200 Long-term debt $448,200 OWNERS' EQUITY Accumulated retained earnings $82,000 Common stock $11,800 $24,100 $161,800 Gross Fixed assets Accumulated depreciation (-). Intangible assets $181,900 = = Assume the following for a firm that will operate for only three years. Year Zero: Capital Investment = $4M and increase in NWC = $0.2M; Years 1-3: NI = $3M, Depreciation = $0.1M, Interest expense = $0.1M; Year 3: Recovery of earlier increase in NWC (i.e., decrease NWC by $0.2M), and in addition Cash Flow from Salvage = $3M. Suppose the tax rate is 30% for the firm. What is the IRR based on the FCFs for this firm in years 0 through 3? 79.03% 35.85% 71.26% 41.84%