The Walker Landscaping Company can purchase a piece of equipment for $3,600. The asset has a two-year life,and will produce a cash flow of $600 in the first year and $4,200 in the second year. The interest rate is 15%. Calculate the project's payback assuming steady cash flows. Also calculate the project's IRR. Should the project be taken?
Check your answer by computing the project's NPV.

Question

The Walker Landscaping Company can purchase a piece of equipment for $3,600. The asset has a two-year life,and will produce a cash flow of $600 in the first year and $4,200 in the second year. The interest rate is 15%. Calculate the project's payback assuming steady cash flows. Also calculate the project's IRR. Should the project be taken?
 Check your answer by computing the project's NPV.

Quizplus · Accepted Answer

The Answer of The Walker Landscaping Company can purchase a piece of equipment for $3,600. The asset has a two-year life,and will produce a cash flow of $600 in the first year and $4,200 in the second year. The interest rate is 15%. Calculate the project's payback assuming steady cash flows. Also calculate the project's IRR. Should the project be taken?
 Check your answer by computing the project's NPV.

The Walker Landscaping Company Can Purchase a Piece of Equipment