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Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the payback period. Payback Period Choose Numerator: Choose Denominator: Payback Period Break even time Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1. and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Chart Values are Based on: |=| Year Compute the recovery time for the break-even time. (Cumulative net cash outflows must be entered with a minus sign. Round your Break-even time answer to 1 decimal place.) 0 1 2 3 4 5 Cash Inflow (Outflow) $ (107,000) x Payback Period Payback period < Payback Period PV Factor 1.0000 = Break even time > Present Value Cumulative Present Value of Inflow (Outflow) S (107,000) $ (107,000)

Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the payback period. Payback Period Choose Numerator: Choose Denominator: Payback Period Break even time Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1. and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Chart Values are Based on: |=| Year Compute the recovery time for the break-even time. (Cumulative net cash outflows must be entered with a minus sign. Round your Break-even time answer to 1 decimal place.) 0 1 2 3 4 5 Cash Inflow (Outflow) $ (107,000) x Payback Period Payback period < Payback Period PV Factor 1.0000 = Break even time > Present Value Cumulative Present Value of Inflow (Outflow) S (107,000) $ (107,000)

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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Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the payback period. Payback Period Choose Numerator: Choose Denominator: Payback Period Break even time Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Chart Values are Based on: i= Year Compute the recovery time for the break-even time. (Cumulative net cash outflows must be entered with a minus sign. Round your Break-even time answer to 1 decimal place.) 0 1 2 3 4 5 Cash Inflow (Outflow) $ < Payback Period x (107,000) x PV Factor - Present Value Payback Period Payback period 1.0000 = = Break even time > = = Cumulative Present Value of Inflow (Outflow) S (107,000) $ (107,000)
Transcribed Image Text:Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the payback period. Payback Period Choose Numerator: Choose Denominator: Payback Period Break even time Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Chart Values are Based on: i= Year Compute the recovery time for the break-even time. (Cumulative net cash outflows must be entered with a minus sign. Round your Break-even time answer to 1 decimal place.) 0 1 2 3 4 5 Cash Inflow (Outflow) $ < Payback Period x (107,000) x PV Factor - Present Value Payback Period Payback period 1.0000 = = Break even time > = = Cumulative Present Value of Inflow (Outflow) S (107,000) $ (107,000)
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