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A machine can be purchased for $150,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-ine depreciation is applied,
A machine can be purchased for $150,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-ine depreciation is applied, using a five-year life and a zero salvage value. Year 1 10,000 $25,000 $50,000 $37,500 $100,000 Year 2 Year 3 Year 4 Year 5 Net income Compute the machine's payback period (ignore taxes). (Round payback period to 3 decimal places.) Year Net Income Depreciation Net Cash Flow Cumulative Cash Flow (150,000) (150,000) $10,000 25,000 50,000 37,500 2 4 0 0 Payback period =
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