What is the payback period of this financial accounting question? Skyline Technologies is evaluating a new project with aninitial cost of $50,000. The project is expected to generatenet cash inflows of $11,500 per year for 7 years. Thecompany's cost of capital is 12%.What is the project's payback period? (Round your answer totwo decimal places.)

Step 1: Definition of Payback PeriodThe payback period is the time required for an investment to…

Answered: Skyline Technologies is evaluating a…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 2PA: Jasmine Manufacturing is considering a project that will require an initial investment of $52,000...

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Skyline Technologies is evaluating a new project with an initial cost of $50,000. The project is expected to generate net cash inflows of $11,500 per year for 7 years. The company's cost of capital is 12%. What is the project's payback period? (Round your answer to two decimal places.)