If a Project's IRR Is 13 Percent and the Project

question 42

Multiple Choice

If a Project's IRR is 13 percent and the project provides annual cash flows of $15,000 for four years, how much did the project cost?

• A)$44,617
• B)$52,200
• C)$60,000
• D)$72,747

---

Definitions:

Interest-Bearing Note

A debt instrument that pays interest to the holder until the maturity date when the principal amount is repaid.

Interest Expense

The cost incurred by an entity for borrowed funds, representing the interest payable on any type of debt.

Accrued Interest

Accrued interest refers to the interest on a bond or loan that has accumulated since the principal investment, or last interest payment, but has not yet been paid.

Adjusting Entry

An accounting transaction recorded to correct or update the financial statements prior to the issuance of the financial statements.