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Doak Corp. is evaluating a project with the following cash flows. The company uses a discount...

Doak Corp. is evaluating a project with the following cash flows. The company uses a discount rate of 11 percent and a reinvestment rate of 8 percent on all of its projects.
Year Cash Flow
0 –$ 32,600  
1 11,520  
2 14,670  
3 11,270  
4 10,940  
5 – 4,230  

Calculate the MIRR of the project using all three methods with these interest rates. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
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Answer #1

Using excel to calculate MIRR for all three approaches

A B
1 Year Cash Flow
2 0 -32600
3 1 11520
4 2 14670
5 3 11270
6 4 10940
7 5 -4230
Discount Rate 11%
Reinvestment rate 8%
MIRR using discounting approach 12.61%
Excel formula MIRR(B2:B7,11%,11%)
MIRR using reinvesting approach 13.83%
Excel formula MIRR(B2:B7,8%,8%)
MIRR using combination approach 10.98%
Excel formula MIRR(B2:B7,11%,8%)
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