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Katarina [22]
3 years ago
7

A certain project has a project cost of $387,000 and the annual inflows resulting from the product created is $64,000. What is t

he Payback Period?
Business
1 answer:
Komok [63]3 years ago
4 0

Answer:

Payback period is 6.5625 years

Explanation:

All amounts are in $

Item                outflow              inflow       balance

Year 0            387,000               0            (387,000)

Year 1                  0                  64,000      (323,000)  

Year 2                 0                  64,000      (259,000)  

Year 3                 0                  64,000      (195,000)  

Year 4                 0                  64,000      (131,000)  

Year 5                 0                  64,000      (67,000)  

Year 6                 0                  64,000      (3,000)

The remaining $3000 will flow in

= (3000/64000) × 12

= 0.5625

Payback period is 6.5625 years

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The Tuck Shop began the current month with inventory costing $10,000, then purchased inventory at a cost of $35,000. The perpetu
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On January 2, 2013, Gant Co. purchased a franchise with a useful life of five years for $60,000 and an annual fee of 1% of franc
inysia [295]

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