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hjlf
3 years ago
5

Heidi Company is considering the acquisition of a machine that costs $420,000. The machine is expected to have a useful life of

6 years, a negligible residual value, an annual net cash inflow of $120,000, and annual operating income of $83,721. The estimated cash payback period for the machine is:__________.
a. 5.1 years
b. 5 years
c. 4 years
d. 3.5 years
Business
1 answer:
Sonja [21]3 years ago
6 0

Answer:

d. 3.5 years

Explanation:

We know that payback period is the estimated length of time it takes cash inflow from a project to recover back the cash outflow.

It is to be noted that the payback period makes use of cash flow and not profit, hence denoted by;

Payback period = Initial cost / Annual net cash inflow

Given that;

Initial cost = $420,000

Annual net cash inflow = $120,000

Therefore,

Payback period = $420,000 / $120,000

Payback period = 3.5 years

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A 1987 advertisement in the New Yorker solicited offers on a 1967 Mercury Cougar XR7 (Motor Trend's 1967 car of the year) that h
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Answer:

You can put this solution on YOUR website!

A 1987 advertisement in the New Yorker solicited offers on a 1967 Mercury Cougar XR7 (Motor Trend's 1967 car of the year) that had been stored undriven in a climate controlled environment for 20 years.

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---------

If the 10% is compounded yearly the price is as followed.

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---

A(10) = 4000(1.1)^10

---

A(10) = $10,374.97

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Cheers,

Stan H.

4 0
2 years ago
If Best Buy chose to compete by introducing online sales direct to the consumer, this would be an example of ______ change
inna [77]

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