Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A machine can be purchased for $90,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-line depreciation is applied

image text in transcribed

A machine can be purchased for $90,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-line depreciation is applied using a five-year life and a zero salvage value. Net income Year 1 $6,000 Year 2 $15,000 Year 3 $36,000 Year 4 $22,500 Year 5 $60,000 Compute the machine's payback period (ignore taxes). (Round your intermediate calculations to 3 decimal places and round payback period answer to 3 decimal places.) Year Net Income Depreciation Net Cash Flow Cumulative Cash Flow $ (90,000) $ (90,000) $ 2. 3 4 6,000 15,000 36,000 22,500 60,000 5 Payback period

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions