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meriva
3 years ago
8

Joe's Hardware is adding a new product line that will require an investment of $ 1,512,000. Managers estimate that this investme

nt will have a​ 10-year life and generate net cash inflows of $ 310,000 the first​ year, $ 270,000 the second​ year, and $ 230,000 each year thereafter for eight years. Compute the payback period. Round to one decimal place.

Business
1 answer:
Sati [7]3 years ago
7 0

Answer:

6.05 years

Explanation:

Payback period is the time in which a project returns back the initial investment in the form of net cash flow. For this purpose we use the net cash flows to calculate the payback.

Payback working is attached with this answer please find it.

You might be interested in
A project that incurs costs in early years and yields benefits in later years has been estimated to have costs just equal to ben
enot [183]

Answer:

The discount rates were lowered

Explanation:

Discount rate is the rate that is used to determine the present value of future cash flows that will be spent in a project.

This is different from the cost of capital which is the amount that just meets the incurred cost of executing a project.

Discount rate determines of the benefits of the project are greater than the cost.

In the given scenario where benefits balance the cost, the project will be worthwhile is discount rate is lower.

That is there will be a lower cost of execution of the project so revenue will be higher than the cost

3 0
3 years ago
Ocean City Kite Company sells kites for $11.50 per kite. In FY 2019, total fixed costs are expected to be $250,000 and variable
Dmitry_Shevchenko [17]

Answer:

40,000 kits

Explanation:

The computation is shown below:

Number of kits required to be sold to meet the goal = Total Contribution Margin Required ÷ Contribution Margin per Unit

where,

Total contribution margin required is

= Total fixed cost + operating income

= $250,000 + $90,000

= $340,000

And, the

Contribution Margin per Unit = Selling Price per Unit - Variable Cost per unit

= $11.50 - $3

= $8.50

So, the number of kits required is

= $340,000 ÷ $8.50

= 40,000 kits

8 0
3 years ago
_____ allows industries, organizations, and companies to approach business decisions from different perspectives. Arbitration Er
RoseWind [281]

Answer:

Workforce diversity

Explanation:

Workforce diversity refers to similarities and differences between employers and employees in terms of their race, religion, gender, perspectives and opinions.

Diversity is important for every industry, organization, and company since people have different perspective and views, they approach business problems differently, leading to different solutions. Diversity leads to increase profits, creativity, wide range of skills e.t.c.

4 0
3 years ago
A company is considering two designs for a machine in its manufacturing line. The first, called machine A, will cost $160000 in
ExtremeBDS [4]

Answer:

The indifference point is 1,410 units

Explanation:

Giving the following information:

Machine A:

Fixed costs= $160,000

Unitary variable cost= $80

Machine B:

Fixed costs= $270,000

Unitary variable cost= $2

<u>First, we need to structure the total cost formula for each machine:</u>

Machine A= 160,000 + 80x

Machine B= 270,000 + 2x

x= number of units

<u>Now, we equal both formulas and isolate x:</u>

160,000 + 80x = 270,000 + 2x

78x = 110,000

x= 110,000/78

x= 1,410 units

The indifference point is 1,410 units

6 0
3 years ago
Retirement income for older women is about ______ percent of that for men.
Alchen [17]

<span>Retirement income for older women is about 55 percent of that for men. In the year 2009, 16 percent of single older men and 21 percent of single older women cut down under the poverty line. Among individuals aged 65, more than two times as many men as women have private pensions.</span>

8 0
4 years ago
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