Probability and Statics The following data applies to a New System to be implemented in a company:
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Probability and Statics The following data applies to a New System to be implemented in a company: 5 Investment cost in n = 0: $ 5,000 Investment cost in n = 1: $ 15,000 6 Shelf life: 10 years Residual value (at the end of 11 years): $ 5,000 7 Annual income: $ 10,000 per year 8 Annual expenses: $ 2,000 per year MARR: 8 % 9 Note: The first income and expenses will occur at the end of year 2. Requirements: A. Determine the conventional payback period 10 B. Determine the discounted payback period 11 I Period Cash Flow Cost of Funds (8%) Accumulated Cash Flow 0 -5,000 0 -5,000 1 -15,000 -5000x0.08= -400 -20,400 2. 8,000 -20,400x0.08= - 1632 -14,032 3 4
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date: