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Ace Hardware is adding a new product line that will require an investment of $1,476,000. Managers estimate that this investment will have a 10-year life and generate net cash inflows of $300,000 the first year, $280,000 the second year, and $250,000 each year thereafter for eight years. Compute the payback period. Round to one decimal place. The payback in years is 5.7

Ace Hardware is adding a new product line that will require an investment of $1,476,000. Managers estimate that this investment will have a 10-year life and generate net cash inflows of $300,000 the first year, $280,000 the second year, and $250,000 each year thereafter for eight years. Compute the payback period. Round to one decimal place. The payback in years is 5.7

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ace Hardware is adding a new product line that will require an investment of $1,476,000. Managers estimate that this investment will have a 10-year life and generate net cash inflows of $300,000 the first year, $280,000 the second year, and $250,000 each year thereafter for eight years. Compute the payback period. Round to one decimal place. The payback in years is 5.7
Transcribed Image Text:Ace Hardware is adding a new product line that will require an investment of $1,476,000. Managers estimate that this investment will have a 10-year life and generate net cash inflows of $300,000 the first year, $280,000 the second year, and $250,000 each year thereafter for eight years. Compute the payback period. Round to one decimal place. The payback in years is 5.7
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