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(e) Compute each project's annual net cash flow (b) Compute payback period for each investment

(e) Compute each project's annual net cash flow (b) Compute payback period for each investment

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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Exercise 24-1 (Algo) Payback period, equal cash flows, and depreciation adjustment LO P1 Information for two alternative projects involving machinery investments follows. Project 1 requires an initial investment of $174,000. Project 2 requires an initial investment of $120,000 Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Incone (0) Compute each project's annual net cash flow (b) Compute payback period for each investment Project 1 $ 104,000 66,000 21,000 9,000 $ 8,000 Project 2 $ 84,000 33,000 19,000 21,000 $ 11,000
Transcribed Image Text:Exercise 24-1 (Algo) Payback period, equal cash flows, and depreciation adjustment LO P1 Information for two alternative projects involving machinery investments follows. Project 1 requires an initial investment of $174,000. Project 2 requires an initial investment of $120,000 Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Incone (0) Compute each project's annual net cash flow (b) Compute payback period for each investment Project 1 $ 104,000 66,000 21,000 9,000 $ 8,000 Project 2 $ 84,000 33,000 19,000 21,000 $ 11,000
Book rences Required A Required B Compute each project's annual net cash flow. Annual Amounts Sales of new producti Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling general, and administrative expenses Income Net cash flow Required A Required B Compute payback period for each investment. Project 1 Project 2 S Numerator $ Income Project 1 104.000 Complete this question by entering your answers in the tabs below. 66.000 21,000 9.000 8,000 Cash Flow Payback Period Denominator: < Required A S Required B > W S Project 2 Income Required 1 84.000 33,000 19.000 21,000 11.000 Cash Flow Payback period
Transcribed Image Text:Book rences Required A Required B Compute each project's annual net cash flow. Annual Amounts Sales of new producti Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling general, and administrative expenses Income Net cash flow Required A Required B Compute payback period for each investment. Project 1 Project 2 S Numerator $ Income Project 1 104.000 Complete this question by entering your answers in the tabs below. 66.000 21,000 9.000 8,000 Cash Flow Payback Period Denominator: < Required A S Required B > W S Project 2 Income Required 1 84.000 33,000 19.000 21,000 11.000 Cash Flow Payback period
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