Your firm is contemplating the purchase of a new 540,000 computer based order entry systemin Other (Other) by vomms
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Your firm is contemplating the purchase of a new 540,000 computer-based order entry system. The system will be depreciated straight-line to zero over its five-year life. It will be worth 52,000 at the end of that time. You will save 300,000 before taxes per year in order processing costs, and you will be able to reduce working capital by 67,000 (this is a one-time reduction). If the tax rate is 35 percent, what is the IRR for this project?