The Ziggy Trim and Cut Company can purchase equipment on sale for $4,300. The asset has a three-year life, will produce a cash flow of $1,200 in the first and second year, and $3,000 in the third year. The interest rate is 12%. Calculate the project's payback assuming end of year cash flows. Also, calculate project's IRR. Should the project be taken? Check your answer by computing the project's NPV.

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The Answer of The Ziggy Trim and Cut Company can purchase equipment on sale for $4,300. The asset has a three-year life, will produce a cash flow of $1,200 in the first and second year, and $3,000 in the third year. The interest rate is 12%. Calculate the project's payback assuming end of year cash flows. Also, calculate project's IRR. Should the project be taken? Check your answer by computing the project's NPV.

The Ziggy Trim and Cut Company Can Purchase Equipment on Sale