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calvinthaw
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$1.00 Please help with this corporate finance problem..

• From Business: Finance
• Closed, but you can still post tutorials
• Due on Jul. 04, 2009
• Asked on Jul 04, 2009 at 8:46:45PM

Q:

Project Evaluation

Your firm is contemplating the purchase of a new $1,221,000 computer-based order entry system. The system will be depreciated straight-line to zero over its 5-year life. It will be worth $118,800 at the end of that time. You will save $475,200 before taxes per year in order processing costs and you will be able to reduce working capital by $127,332 (this is a one-time reduction). If the tax rate is 30 percent, the IRR for this project is ________ %

 

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