(Ignore income taxes in this problem.) The management of Kountz Corporation is considering the purchase of a machine that would cost $74,520 and would have a useful life of 8 years. The machine would have no salvage value. The machine would reduce labor and other operating costs by $20,000 per year.
Required:
Determine the internal rate of return on the investment in the new machine. Show your work!

Question

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The Answer of (Ignore income taxes in this problem.) The management of Kountz Corporation is considering the purchase of a machine that would cost $74,520 and would have a useful life of 8 years. The machine would have no salvage value. The machine would reduce labor and other operating costs by $20,000 per year.
Required:
Determine the internal rate of return on the investment in the new machine. Show your work!

(Ignore Income Taxes in This Problem