21Beyer Company is considering the purchase of an asset for $210,000. It is expected to produce the following net cash flows. The cashflows occur evenly within each year.Net cash flowsYear012345Cash Inflow(Outflow)Compute the payback period for this investment. (Cumulative net cash outflows must be entered with a minus sign. Round yourPayback Period answer to 2 decimal place.)S(210,000)Year 1$64,000Payback period =Year 2 Year 3Year 4$33,000 $62,000 $150,000Cumulative NetCash Inflow(Outflow)Year 5$28,000SavedTotal$337,000

Payback period is the period within which the company recovers its investment amount in a project.

Beyer Company is considering the purchase of an asset for $210,000. It is expected to produce the following net cash flows occur evenly within each year. Net cash flows Year 1 $64,000 Year 2 $33,000 Year 3 $62,000 Year 4 $150,000 Year 5 $28,000 Total $337,000

Beyer Company is considering the purchase of an asset for $210,000. It is expected to produce the following net cash flows occur evenly within each year. Net cash flows Year 1 $64,000 Year 2 $33,000 Year 3 $62,000 Year 4 $150,000 Year 5 $28,000 Total $337,000

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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