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Sunland Corporation is involved in the business of injection moulding of plastics. It is considering...

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Accounting

Sunland Corporation is involved in the business of injection moulding of plastics. It is considering the purchase of a new computeraided design and manufacturing machine for $426,100. The company believes that with this new machine it will improve productivity and increase quality, resulting in a $109,500 increase in net annual cash flows for the next five years. Management requires a 13% rate of return on all new investments.
Click here to view the factor table.
Calculate the internal rate of return on this new machine. (Round answer to 0 decimal places, e.g.10%. For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g.1.52124.)
Internal rate of return
Should management accept the investment?
The investment be accepted.
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