Assignment title: Information
You are considering purchasing a new production facility to expand operations. The building
and machinery will cost $800,000 and be depreciated over 10 years using the straight-line
method with no salvage value at the end of the equipment-life. You require a 12% rate of
return on the project.
The cost and revenue information follows in the table below:
1. Determine the NPV of the new facility.
2. Calculate the IRR (approximate).
3. Calculate the payback period.
4. Calculate the accounting rate of return.
Taking into considerations all the calculations above, will you invest in the new production
facility? Why or why not? What nonfinancial information will you consider in your decision?
Submit your completed assignment by following the directions linked below. Please check
theĀ Course CalendarĀ for specific due dates.
Save your assignment as a Microsoft Excel spreadsheet. (Mac users, please remember to
append the ".xlsx" extension to the filename.) The name of the file should be your first initial
and last name, followed by an underscore and the name of the assignment, and an
underscore and the date. An example is shown below: