Question
Sierra Company is considering a long-term investment project called ZIP. ZIP will require an investment of $238,320. It will have a useful life of four
Sierra Company is considering a long-term investment project called ZIP. ZIP will require an investment of $238,320. It will have a useful life of four years and no salvage value. Annual cash inflows would increase by $158,880, and annual cash outflows would increase by $81,426. The companys required rate of return is 12%. Calculate the internal rate of return on this project. (Round answer to 1 decimal place, e.g. 12.4%.)
Internal rate of return %
Identify whether the project should be accepted or rejected.
The project should be acceptedrejected.
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