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# Answer to Question #9192 in Finance for rim

Question #9192
The Golf Range is considering adding an additional driving range to its facility. The range would cost $76,000, would be depreciated on a straight line basis over its 7-year life, and would have a zero salvage value. The anticipated income from the project is$34,000 a year with $14,400 of that amount being variable cost. The fixed cost would be$16,200. The firm believes that it will earn an additional $13,000 a year from its current operations should the driving range be added. The project will require$2,000 of net working capital, which is recoverable at the end of the project. What is the internal rate of return on this project at a tax rate of 34 percent?
7.53 percent
9.29 percent
11.47 percent
12.68 percent
14.04 percent
1
2012-05-11T08:19:39-0400

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