The following information applies to ALL parts of capital budgeting question

The Pan American Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $250,000 and is expected to have a useful life of 5 years, with a terminal disposal value of $10,000. Additional working capital of $25,000 is needed to keep the machine running efficiently, but this investment is fully recoverable at the end of the project. The company uses the straight-line depreciation method for its non-current assets, and its required rate of return is 10%. The annual cash flows have the following projections.

Year	Cash Flow
1............	$80,000
2............	100,000
3............	80,000
4............	60,000
5............	20,000

(c) Calculate the Internal rate of return (IRR) of the new machine, using the interpolation method