The Comil Corporation Recently Purchased a New Machine for Its

question 23

Multiple Choice

The Comil Corporation recently purchased a new machine for its factory operations at a cost of $328,325. The investment is expected to generate $115,000 in annual cash flows for a period of four years. The required rate of return is 13%. The old machine has a remaining life of four years. The new machine is expected to have zero value at the end of the four-year period. The disposal value of the old machine at the time of replacement is zero. What is the internal rate of return?

• A) 12%
• B) 13%
• C) 14%
• D) 15%

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