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34kurt
3 years ago
7

Payback period was the earliest -Select- selection criterion. The -Select- is a "break-even" calculation in the sense that if a

project's cash flows come in at the expected rate, the project will break even. The equation is:
Business
1 answer:
soldier1979 [14.2K]3 years ago
5 0

Answer: 1. Capital Budgeting

2. Payback Period

3. Number of Years Prior to Full Recovery + (Unrecovered Cost at Start of Year / Cash flow during the year)

Explanation:

Payback period was the earliest <u>Capital Budgeting</u> selection criterion. The <u>Payback Period</u> is a "break-even" calculation in the sense...

The Payback period is one of the most simple methods in Capital Budgeting and the earliest as well. It simply checked how long it would take to pay back an investment which made it very alluring to investors who wanted to know how long it would be till they started getting a profit.

It therefore essentially checked when the project would Break-Even.

The formula is,

Number of Years Prior to Full Recovery + (Unrecovered Cost at Start of Year / Cash flow during the year)

This means that to calculate the Payback Period, for example, say the investment was $500 and the project brought in $120 for 5 years.

That would mean that in year 4 it would have brought it $480. Year 4 is the <em>Number of Years prior to Full recovery</em>.

The $20 left is the <em>Unrecovered cost at the start of the year</em> and the <em>Cashflow for the year is $120</em>. The Payback is therefore,

= 4 + (20/120)

= 4.17

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Internal failure costs are costs incurred​ ________. A. after the company delivers poorminusquality goods or services to custome
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2 years ago
A company's fixed operating costs are $420,000, its variable costs are $3.20 per unit, and the product's sales price is $4.65. W
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Answer: The volume of sales that will result in a break-even point is 289,655 units

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The equation to determine the profit or otherwise of an organization is given as Revenue minus Cost. That is, the sales figure should exceed the cost of production, and the excess would be the profit. If on the other hand the cost of production exceeds the sales figure, then the equation would result in a negative figure which simply means a loss has been recorded.

In the question above, the costs have been given as;

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7 0
3 years ago
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