The Janna Company is planning to purchase a new machine. The payback period will be six years. The cash flow from operation , net of income taxes, will be P20,000 a year for each of the first three years of the payback period and P30,000 a year for each of the last three years of the payback period. Depreciation of P15,000 a year will be charged to income for each of the six years of the payback period. How much will the machine cost?
The Janna Company is planning to purchase a new machine. The payback period will be six years. The cash flow from operation , net of income taxes, will be P20,000 a year for each of the first three years of the payback period and P30,000 a year for each of the last three years of the payback period. Depreciation of P15,000 a year will be charged to income for each of the six years of the payback period. How much will the machine cost?
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
Problem 1PS
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The Janna Company is planning to purchase a new machine. The payback period will be six years. The cash flow from operation , net of income taxes, will be P20,000 a year for each of the first three years of the payback period and P30,000 a year for each of the last three years of the payback period.
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