Cornerstones of Managerial Accounting 6th Edition by Maryanne Mowen,Don Hansen ,Dan Heitger

Exercise 53

Internal Rate of Return
Randel Company produces a variety of gardening tools and aids. The company is examining the possibility of investing in a new production system that will reduce the costs of the current system. The new system will require a cash investment of $3,455,400 and will produce net cash savings of $600,000 per year. The system has a projected life of 9 years.
Required:
Calculate the IRR for the new production system.