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Phoenix [80]
3 years ago
7

If a proposed expenditure of $80,000 for a fixed asset with a 4-year life has an annual expected net cash flow and net income of

$32,000 and $12,000, respectively, the cash payback period is 2.5 years.
a. true
b. false
Business
1 answer:
Whitepunk [10]3 years ago
6 0

Answer: a. true

Explanation:

Cash payback period shows the amount of time it will take for cash inflows from an investment to pay off the investment.

Cash payback period = Investment/ Cash inflow

= 80,000/32,000

= 2.5 years

<em>Statement is proven true. </em>

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4 years ago
Brown Street Grocers has a cost of equity of 11.8 percent, a pre-tax cost of debt of 6.9 percent, and a tax rate of 35 percent.
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The correct answer to the following question is option E) 9.06% .

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