The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $ 61,000 $ 3,000 2 $ 5,000 $ 6,000 3 $ 12,000 4 $ 13,000 5 $ 16,000 6 $ 10,000 7 $ 8,000 8 $ 10,000 9 $ 9,000 10 $ 9,000 Required: 1. Determine the payback period of the investment. 2. Would the payback period be affected if the cash inflow in the last year were several times as large? REQUIRED 1 Determine the payback period of the investment. (Round your answer to 1 decimal place.) Payback period ______ years
The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $ 61,000 $ 3,000 2 $ 5,000 $ 6,000 3 $ 12,000 4 $ 13,000 5 $ 16,000 6 $ 10,000 7 $ 8,000 8 $ 10,000 9 $ 9,000 10 $ 9,000 Required: 1. Determine the payback period of the investment. 2. Would the payback period be affected if the cash inflow in the last year were several times as large? REQUIRED 1 Determine the payback period of the investment. (Round your answer to 1 decimal place.) Payback period ______ years
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The management of Unter Corporation, an architectural design firm, is considering an investment with the following
| Year | Investment | |||
| 1 | $ | 61,000 | $ | 3,000 |
| 2 | $ | 5,000 | $ | 6,000 |
| 3 | $ | 12,000 | ||
| 4 | $ | 13,000 | ||
| 5 | $ | 16,000 | ||
| 6 | $ | 10,000 | ||
| 7 | $ | 8,000 | ||
| 8 | $ | 10,000 | ||
| 9 | $ | 9,000 | ||
| 10 | $ | 9,000 | ||
Required:
1. Determine the payback period of the investment.
2. Would the payback period be affected if the cash inflow in the last year were several times as large?
REQUIRED 1
Determine the payback period of the investment. (Round your answer to 1 decimal place.)
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