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Find the internal rate of return on the machine

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Question - Krauth Company purchased a machine for $119,000. The machine has a life of seven years with no salvage value. It is expected that the machine will generate annual net cash inflows of $28,000 per year over its useful life. Assume Krauth Company employs a cost of capital of 10% on all capital investment projects.

The internal rate of return (IRR) on the machine is closest to:

A. 9%

B. 10%

C. 12%

D. 14%

E. 15%

F. 16%

Reference no: EM131643288

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