2. 
   

2. What is the payback period if cost = $60,000; CF = $12,500 per year for 4 years
4. Estimate the erosion cost associated with this venture:
   2. Frosty Desserts currently sell 120,000 of its Strawberry-Shortcake Delight each year for $4.25 per serving.
   4. Its cost per serving is $2.75.
   6. It is estimated that after the launch the sales for the original variety will drop by 15%.
7. The cost of a car is $300,000 with an additional $25,000 for delivery. Calculate the annual deprecation expenses.

Answer rating: 100% (QA)

To calculate the payback period you need to determine how long it takes for the cumulative cash flows CF to equal or exceed the initial cost In this case the cost is 60000 and the cash flow ... View the full answer