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Liula [17]
3 years ago
6

Beyer Company is considering the purchase of an asset for $180,000. It is expected to produce the following net cash flows. The

cash flows occur evenly within each year. Year 1 Year 2 Year 3 Year 4 Year 5 Total Net cash flows $ 60,000 $ 40,000 $ 70,000 $ 125,000 $ 35,000 $ 330,000 Compute the payback period for this investment. (Cumulative net cash outflows must be entered with a minus sign. Round your Payback Period answer to 2 decimal place.)
Business
1 answer:
Rzqust [24]3 years ago
5 0

Answer:

The payback period for this investment is 3.08 years.

Explanation:

Payback Period: The payback period is that period which shows that in which year or in which period, the investment amount should be recovered.

For computing the payback period, first we have to calculate the total of yearly cash flows which is equal to the initial investment. If it is not equal or less than, so difference is taken which is divided by next year cash inflows.

The formula is shown below:

= Approximate Years in which the amount is recovered + Difference ÷ Next year cash-flows

where,

Initial investment = $180,000

Year 1 cash inflow = -$60,000

Year 2 cash inflow = -$40,000

Year 3 cash inflow = -$70,000

Year 4 cash inflow = -$125,000

Year 5 cash inflow = -$35,000

Now, sum of year 1 + year 2 + year 3 cash flows = $60,000 + 40,000 + 70,000 gives the 170,000 amount

So,

In 3 year, the 170,000 amount is recovered. For accurate results we proportionate the difference with next year cash flows

In mathematically,

= 3 + (180,000 - 170,000) ÷ $125,000

= 3 + $10,000 ÷ $125,000

= 3 + 0.08

= 3.08 year.

Hence, the payback period for this investment is 3.08 years.

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Mkey [24]

Answer:

The answer is $30000

Explanation:

                                                                      $                                $

Sales                                                                                             195000

<u>Less cost of sales</u>

Opening stock                                          12000

<u>Add</u> purchases                                         <u> 97000</u>

                                                                   109000

<u>Less </u>closing stock                                      <u>6000</u>

                                                                                                       <u>103000</u>

Gross profit                                                                                     92000

<u>Less</u> operating expenses                                                              <u>62000</u>

Operating income                                                                           <u>30000</u>

The operating income is<u> $30000</u>

4 0
3 years ago
Uncle Fred recently died and left $280,000 to his 45-year-old favorite niece. She immediately spent $80,000 on a town home but d
Marrrta [24]

Answer:

6.06%

Explanation:

The computation of the rate of return is shown below:

Given that

NPER = 20 years

PV = ($280,000 - $80,000) = $200,000

PMT = $0

FV = $75,000 × PVIFA factor at 10% for 21 years

= $75,000 × 8.6487

= $648,652.50

The following formula should be applied

= RATE(NPER;PMT;-PV;FV;TYPE)

The present value comes in negative

After applying the above formula, the rate of return is 6.06%

7 0
3 years ago
Wally owns 200 acres of land.Wally offers to sell the land to Robert for $1,500 per acre.Robert replies that he does not need 20
stiv31 [10]

Answer:

D) Wally wins; this agreement is too indefinite since it does not identify which 40 acres are to be sold.

Explanation:

Since in the given situation, wally agrees to sell but here the identification of the land is not mentioned i.e. 40 acres and at the later time the wally refused to sold any land so here wally should wins as the agreement is not definite which type of the land should be sold so it becomes the agreement void

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8 0
3 years ago
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denis23 [38]

Answer: false

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4 0
2 years ago
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Viefleur [7K]

Answer:

Estimated manufacturing overhead rate= $32 per direct labor hour

Explanation:

Giving the following information:

At the beginning of the current year, management estimated that $672,000 in overhead costs would be incurred and the company would produce and sell 2,000 units of the flexible model and 10,000 units of the rigid model.

The flexible model requires 3.0 hour(s) of direct labor time per unit, and the rigid model requires 1.50 hour(s).

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base=

Estimated manufacturing overhead rate= 672,000/(2000*3 + 10000*1.5)= $32 per direct labor hour

8 0
2 years ago
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