The management of XYZ Beverage Company is considering to purchase a new equipment to increase the production and revenues. The useful life of the equipment is 10 years. Initial cost of equipment is $30.000. Expected annual cash flows from new equipment is 75.000. Annual cash Outflows are :Cost of ingredients: $45,000; Salaries expenses: $13,500; Maihtenance expenses: $1,500. Depreciation expense: $5,000. In that case what is payback time (as years) for this equipment? 17500 170 O A) 2,0 O B) 3,5 OC) 5,0 OD) 4,0 OE) 3,0

The management of XYZ Beverage Company is considering to purchase a new equipment to increase the production and revenues. The useful life of the equipment is 10 years. Initial cost of equipment is $30.000. Expected annual cash flows from new equipment is 75.000. Annual cash Outflows are :Cost of ingredients: $45,000; Salaries expenses: $13,500; Maihtenance expenses: $1,500. Depreciation expense: $5,000. In that case what is payback time (as years) for this equipment? 17500 170 O A) 2,0 O B) 3,5 OC) 5,0 OD) 4,0 OE) 3,0

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 18EB: Garnette Corp is considering the purchase of a new machine that will cost $342,000 and provide the...

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The management of XYZ Beverage Company is considering to purchase a new equipment to increase the production and revenues. The useful life of the equipment is 10 years. Initial cost of equipment is $30.000. Expected annual cash flows from new equipment is 75.000. Annual cash Outflows are :Cost of ingredients: $45,000; Salaries expenses: $13,500; Maihtenance expenses: $1,500. Depreciation expense: $5,000. In that case what is payback time (as years) for this equipment? 171800 O A) 2,0 O B) 3,5 O C) 5,0 O D) 4,0 O E) 3,0
The management of XYZ Beverage Company is considering to purchase a new equipment to increase the production and revenues. The useful life of the equipment is 10 years. Initial cost of equipment is $30.000. Expected annual cash flows from new equipment is 75.000. Annual cash Outflows are : Cost of ingredients: $45,000; Salaries expenses: $13,500; Maintenance expenses: $1,500. Depreciation expense: $5,000. In that case what is payback time (as years) for this equipment? O A) 3,0 O B) 2,0 O C) 5,0 D) 3,5 E) 4,0
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