Assume a $300,000 Investment and the following cash flows for two products: Year Product X Product Y 1 2 3 4 $ 90,000 100,000 20,000 50,000 $ 100,000 100,000 90,000 50,000 a. Calculate the payback for products X and Y. Note: Do not round Intermediate calculations. Round your answers to 2 decimal places. Answer is complete but not entirely correct. Product X 0.00 Product Y 3.20 years years b. Which alternative would you select under the payback method? Product Y is selected O Product X is selected
Assume a $300,000 Investment and the following cash flows for two products: Year Product X Product Y 1 2 3 4 $ 90,000 100,000 20,000 50,000 $ 100,000 100,000 90,000 50,000 a. Calculate the payback for products X and Y. Note: Do not round Intermediate calculations. Round your answers to 2 decimal places. Answer is complete but not entirely correct. Product X 0.00 Product Y 3.20 years years b. Which alternative would you select under the payback method? Product Y is selected O Product X is selected
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Problem 12-6 (Algo) Payback method [LO12-3]
Assume a $300,000 Investment and the following cash flows for two products:
Year Product X
1
2
3
4
$ 90,000
100,000
20,000
50,000
Product Y
$100,000
100,000
90,000
50,000
a. Calculate the payback for products X and Y.
Note: Do not round Intermediate calculations. Round your answers to 2 decimal places.
Answer is complete but not entirely correct.
Product X
0.00x years
Product Y
3.20
years
b. Which alternative would you select under the payback method?
Product Y is selected
Product X is selected](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F55f14fd3-4860-4450-9a31-55c6b0050e6e%2Fb214682b-5d62-4d4c-ac4e-7308d2270f3c%2Ftt54tfe_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 12-6 (Algo) Payback method [LO12-3]
Assume a $300,000 Investment and the following cash flows for two products:
Year Product X
1
2
3
4
$ 90,000
100,000
20,000
50,000
Product Y
$100,000
100,000
90,000
50,000
a. Calculate the payback for products X and Y.
Note: Do not round Intermediate calculations. Round your answers to 2 decimal places.
Answer is complete but not entirely correct.
Product X
0.00x years
Product Y
3.20
years
b. Which alternative would you select under the payback method?
Product Y is selected
Product X is selected
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