Mike’s Camping Supply is considering the purchase of new equipment for $750,000. The equipment will allow the company to generate additional cash revenues of $180,000 each year. The company will incur total expenses of $64,000 from the machine each year, including $7,000 related to depreciation. Calculate the cash payback period, rounding answer to two decimal places.
Mike’s Camping Supply is considering the purchase of new equipment for $750,000. The equipment will allow the company to generate additional cash revenues of $180,000 each year. The company will incur total expenses of $64,000 from the machine each year, including $7,000 related to depreciation. Calculate the cash payback period, rounding answer to two decimal places.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Mike’s Camping Supply is considering the purchase of new equipment for $750,000. The equipment will allow the company to generate additional cash revenues of $180,000 each year. The company will incur total expenses of $64,000 from the machine each year, including $7,000 related to depreciation. Calculate the cash payback period, rounding answer to two decimal places.
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