Iggy Company is considering three capital expenditure projects. Relevant data for the projects are as follows. Project Investment Annual income Life of project
22A $242,200 $16,890 6 years
23A $271,500 $20,710 9 years
24A $283,000 $15,700 7 years
Annual income is constant over the life of the project. Each project is expected to have zero salvage value at the end of the project. Iggy Company uses the straight-line method of depreciation.
Required:
Determine the internal rate of return for each project.