Russell Corp. is considering the purchase of a new machine for $76,000. The machine would generate an annual cash flow of $23,214 for five years. At the end of five years, the machine would have no salvage value. What is the payback period in years for the machine? a. 3 b. 9.48 c. 3.27 d. 4

Russell Corp. is considering the purchase of a new machine for $76,000. The machine would generate an annual cash flow of $23,214 for five years. At the end of five years, the machine would have no salvage value. What is the payback period in years for the machine? a. 3 b. 9.48 c. 3.27 d. 4

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 11PA: Gallant Sports s considering the purchase of a new rock-climbing facility. The company estimates...

See similar textbooks

Related questions

Q: Financial Accounting

A: The future value of $2,968 invested for 9 years at 4.9% compounded annually is calculated using the…

Q: What is the net operating income on these general accounting question?

A: Option a: This option is incorrect because this is only the contribution margin and not the net…

Q: DJ Fiber Mill processes raw wool into high-quality cleaned wool. The raw wool costs $8 per pound,…

A: Explanation of Raw Wool: Raw wool is the unprocessed wool that comes directly from sheep before any…

Q: Kindly help me Accounting question

A: Step 1: Definition of Break-Even and Target Profit AnalysisBreak-even and target profit analysis…

Q: General Accounting question

A: Step 1: Define Cash FlowCash flows are important values while evaluating an investment opportunity.…

Q: Wanna Answer with explanation

A: Concept of Process CostingProcess costing is a cost accounting method used when production involves…

Q: At the end of last year, James, a 30% partner in the four- person... Please answer the accounting…

A: Step 1: Definition of Gain or Loss on Sale of Partnership InterestWhen a partner sells their…

Q: I want to correct answer general accounting

A: Step 1: Recall the Cost of Goods Manufactured (COGM) formula.= total manufacturing costs + beginning…

Q: I need this question financial accounting

A: Step 1: Define Budgeted Material PurchasesThe direct materials budget is used to calculate the…

Q: which is correct?

A: Explanation of Off-Market Swaps:Off-market swaps are derivative contracts where the terms, such as…

Q: What is the amount of budgeted direct labor cost for the month of July? General accounting

A: Step 1: Define Direct LaborDirect labor refers to the amount of wages of the persons who are…

Q: Compute

A: Concept of NOPAT Turnover (ATO):The NOPAT Turnover, also referred to as Asset Turnover (ATO),…

Q: Kindly help me with accounting questions

A: Step 1: Definition of Gross Profit and LIFO MethodGross Profit: The difference between sales revenue…

Q: I won't to this question answer general Accounting

A: Step 1: Define Capital gainsCapital gains is gain earned by the selling the assets in the…

Q: Do fast answer of this accounting questions

A: Step 1: Definition of Accounting Equation and Equity ChangesThe accounting equation states that…

Q: Baltimore manufacturing had a work in process solution general accounting question

A: Step 1: Define Work-in-Process Inventory AccountThe work-in-process inventory account is a general…

Q: Hello tutor please provide correct answer financial accounting

A: Step 1: Define Realized GainRealized gain refers to the gain that has been earned by the sale of an…

Q: I need answer of this accounting questions

A: To calculate Gross Profit and Operating Income under absorption costing, follow these steps: 1.…

Q: Please solve this question financial accounting

A: Step 1: Define Normal CostingNormal Costing is a way of assigning costs to the products. Under…

Q: Do fast answer of this accounting questions

A: Step 1: Definition of Lockbox System SavingsA lockbox system speeds up the collection of…

Q: General Accounting Question please answer do fast

A: Step 1: Calculate the Capital Gains Step 2: Calculate the Total Dividends Step 3: Calculate the…

Q: I Need help this question solution general Accounting

A: Step 1: Define Direct Labor Budget:The direct labor budget is one of the manufacturing cost budgets…

Q: Kindly help me Accounting question

A: Step 1: Definition of Gross Profit MethodThe gross profit method estimates the value of damaged or…

Q: Solve this question general Accounting

A: Step 1: Define Standard CostDirect Materials is the materials used in producing the product that is…

Q: I want answer please help accounting expert

A: Explanation of Process-Based Validation: This is a systematic approach to evaluating control…

Q: Financial accounting questions

A: Step 1: Define Accounts Receivable ManagementThe process of establishing limitations on choice of…

Q: Hi expert please give me answer general accounting question

A: Step 1: Definition of Activity-Based Costing (ABC)Activity-Based Costing (ABC) allocates overhead…

Q: Kindly help me Accounting question

A: Step 1: Definition of Cost of Goods Sold (COGS)The cost of goods sold (COGS) includes the costs…

Q: Financial Accounting

A: Step 1: Define Paycheck and CommissionFor salesmen where the amount of money generated is directly…

Q: Please tutor give the accurate step by step answer to this general accounting problem

A: Explanation of Total Revenue:Total revenue refers to the total amount of money a business earns from…

Q: Financial accounting questions

A: Step 1: Define Accounts receivable turnoverThe ability of a company to recover its outstanding…

Q: Don't use ai given answer accounting questions

A: Step 1: Definition of Cash Conversion CycleThe cash conversion cycle (CCC) measures the time it…

Q: Need answer the general accounting question

A: Step 1: Define TurnoverTurnover in ROI (Return on Investment) analysis is a measure of how…

Q: What is it's cash conversion cycle for this accounting question?

A: Step 1: Define Cash Conversion CycleCash conversion cycle traces the time period for which cash is…

Q: West Company estimates that overhead costs for the next year... Can you please answer the general…

A: Step 1: Define Plant wide Overhead RateThe term 'plant wide overhead rate' refers to the single rate…

Q: Why does business model analysis affect accounting choices?

A: ReferencesEpstein, B. J., & Jermakowicz, E. K. (2020). Wiley IFRS 2020: Interpretation and…

Q: Riverside manufacturing has a contribution margin ratio solve this accounting questions

A: Step 1: Definition of Operating ProfitOperating profit refers to the profit a company generates from…

Q: METLOCK COMPANY Comparative Balance Sheet Assets Dec. 31, 2025 Dec. 31, 2024 Cash $33,900 $12,500…

A: Step 1:Cash Flow Statement:-Cash Flow Statement is the statement prepared at the end of accounting…

Q: Need help with this accounting questions

A: Step 1: Definition of Profitability Index (PI)The Profitability Index (PI) is a ratio that measures…

Q: Not use ai solution general Accounting

A: The question requires the determination of the cost of common stock. Common stock is primarily a…

Q: The per unit standards for direct solve this accounting questions

A: Step 1: Definition of Direct Labor VarianceThe total direct labor variance measures the difference…

Q: Delivery Dudes Services has the collected the following information about operating expenditures for…

A: Explanation of High-Low Method:The high-low method is a cost analysis tool used to separate mixed…

Q: Hello tutor please provide correct answer general Accounting

A: To calculate the total fixed costs, we use the formula for operating income: Operating Income =…

Q: Please provide correct answer financial accounting

A: Step 1: Define Return on equityThe equity return is the total gain made by the company's…

Q: Maple manufacturing has provided its contribution solve this accounting questions

A: Step 1: Definition of Contribution MarginThe contribution margin is the portion of sales revenue…

Q: Please need answer the financial accounting question not use ai

A: Step 1: Define Required ReturnThe required return for preferred stock is the rate of return that…

Q: Financial Accounting Question answer step by step calculation and correct

A: Step 1: Information provided Work in Process on January 1, 2018 (Beginning WIP) = $138,000Ending WIP…

Q: Hii expert please provide correct answer general Accounting

A: Step 1: Define Standard Labor CostThe standard labor cost of a product or service is calculated on a…

Q: 5 PTS

A: Option a: This option is incorrect because standard variances require investigation. Even if it is a…

Q: Bazuka Accounting Services recorded several financial transactions during the period. The company…

A: Explanation of Accounts Receivable: Accounts Receivable represents the money owed to a company by…

Question

What is the payback period in years for the machine on these financial accounting question?

Russell Corp. is considering the purchase of a new machine for
$76,000. The machine would generate an annual cash flow of
$23,214 for five years. At the end of five years, the machine
would have no salvage value.
What is the payback period in years for the machine?
a. 3
b. 9.48
c. 3.27
d. 4

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Taos Productions bought a piece of equipment for $79,860 that will last for 5 years. The equipment will generate net operating cash flows of $20,000 per year and will have no salvage value at the end of its life. What is the internal rate of return?
hi, can you solve this ?
Xavier Co. wants to purchase a machine for $37,400 with a four-year life and a $1,100 salvage value. Xavier requires an 8% return on investment. The expected year-end net cash flows are $12,400 in each of the four years. What is the machine's net present value? Periods Present Valueof $1 at 8% Present Value of anAnnuity of $1 at 8% 1 0.9259 0.9259 2 0.8573 1.7833 3 0.7938 2.5771 4 0.7350 3.3121
Consider a machine purchased one year ago for $18,000. The machine is being depreciated $3,000 per year throughout a six-year period. Its current market value is $6,000, and the expected market value of the machine one year from now is $4,000. If the interest rate is 10%, the expected cost of holding the machine during the next year is $___.
Enerlam Company purchased a machine with an estimated useful life of seven years. The machine will generate cash inflows of P9,000 each year over the next seven years. If the machine has no salvage value at the end of seven years, and assuming the company's discount rate is 10%, what is the purchase price of the machine if the net present value of the investment is P17,000?a. P43,812b. P26,812c. P17,000d. P22,195
Palmer Corporation is considering the purchase of a new plece of equipment. The cost savings from the equipment would result in an annual increase in net income of $152,000. The equipment will have an initial cost of $494,000 and a 8 year useful life. If the salvage value of the equipment is estimated to be $78,000, what is the payback period? Multiple Choice 2.42 years 3.25 years 8.00 years 4.00 years
10.
i need the answer quickly
T1.
Crane’s Custom Construction Company is considering three new projects, each requiring an equipment investment of $22,220. Each project will last for 3 years and produce the following net annual cash flows. Year AA BB CC 1 $7,070 $10,100 $13,130 2 9,090 10,100 12,120 3 12,120 10,100 11,110 Total $28,280 $30,300 $36,360 The equipment’s salvage value is zero, and Crane uses straight-line depreciation. Crane will not accept any project with a cash payback period over 2 years. Crane’s required rate of return is 12%. (a)Compute each project’s payback period. (Round answers to 2 decimal places, e.g. 15.25.) AA years BB years CC years (b)Compute the net present value of each project. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round final answers to the nearest whole dollar, e.g. 5,275. For calculation purposes, use 5 decimal places as…
Nelson Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $105,000. The equipment will have an initial cost of $420,000 and have a 5 year life. If the salvage value of the equipment is estimated to be $80,000, what is the payback period? Ignore income taxes. Multiple Choice 3.24 years 4.00 years 4.76 years 7.00 years
As entrepreneur is considering raising a bank loan to buy a firm year life span machine costing two millions(2,000,000) the cost of dept is 15% per annum and the machine will have no salvage value at the end of its life span. If the operation from the machine will yield the following annual cash flows. Year 1= #490000 Year 2=#420000 Year 3=#340000 Year 4=#400000 Year 5=#380000 Determine weather or not the manager should implement the project on the basis of 1. Net Present Value (NPV). 2. Profitability Index (PI). 3. Internal Rate if Return (IRR).