Reference no: EM132528676

APPLY THE CONCEPTS: Internal rate of return

The Rydell purchasing department has made revisions to their costs and annual cash flows for Project A and Project B, as outlined below.

1. Project A's revised investment is $236,100. The project's life and cash flow have changed to 7 years and $48,500, respectively, while expenses have been eliminated.
2. Project B's revised investment is $141,500. The project's life and cash flow have changed to 6 years and $87,500 while expenses reduced slightly to $55,000.Compute the internal rate of return factor for Project A and Project B and then identify each project's corresponding percentage from the PV ordinary annuity table.

Note: Enter the IRR factor, to 5 decimal places

Question 1: Project A: The calculated IRR factor is ______and this value corresponds to which percentage in the present value of ordinary annuity table?______

Question 2: Project B: The calculated IRR factor is ______ and this value corresponds to which percentage in the present value of ordinary annuity table?