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IRR of Lazy Mower Project

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Using the second case study in the attachment I have a few questions:

Using the base case estimates calculate the cash, accounting, and financial breakeven of teh Lazy Mower Project. Interpret each one.

Let's say the company had spent $500,000 in developing the prototype of the Lazy Mower. How should Dan and Ron treat this item in their report? Explain.

Calculate the IRR of the project. Based on your calculations what would you recommend and why?

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Solution provided by:
Sonia Agarwal, CA
Education
  • Chartered Accountant (Equivalent to CPA in US), Institute of Charted Accountants of India
  • Bachelor of Commerce, West Bengal University
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