156. The internal rate of return method is used to analyze an $946,250 capital investment proposal with annual net cash flows of $250,000 for each of the six years of its useful life. 157. Tipper...

156. The internal rate of return method is used to analyze an $946,250 capital investment proposal with annual net cash flows of $250,000 for each of the six years of its useful life.

157. Tipper Co. is considering a 10-year project that is estimated to cost $700,000 and has no residual value. Tipper seeks to earn an average rate of return of 15% on all capital projects. Determine the necessary average annual income (using straight-line depreciation) that must be achieved on this project for this project to be acceptable to Tipper Co.

158. Proposals A and B each cost $500,000 and have 5-year lives. Proposal A is expected to provide equal annual net cash flows of $109,000, while the net cash flows for Proposal B are as follows:

159. A $400,000 capital investment proposal has an estimated life of four years and no residual value. The estimated net cash flows are as follows:

1$200,0003$90,000

2150,000480,000