Question
The Management of Carla Vista Manufacturing Company is evaluating two forklift systems to use in its plant that produces the towers for a windmill power
The Management of Carla Vista Manufacturing Company is evaluating two forklift systems to use in its plant that produces the towers for a windmill power farm. The costs and the cash flows from these systems are shown below. The company uses a 12 percent discount rate for all projects. Year 0 Year 1 Year 2 Year 3 Otis Forklifts $-3,127,450 $964,225 $1,358,886 $2,112,497 Craigmore Forklifts $-4,133,410 $860,236 $1,766,225 $2,879,110 NPV Otis forklift $320,395 Craigmore Forklifts $91,976 Compute the IRR for each of the two systems. (Round intermediate calculation to 0 decimal places, e.g. 1,525 and final answers to 2 decimal places, e.g. 15.10%.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started