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A shoe manufacturer is evaluating new equipment that would custom fit athletic shoes. The new equipment costs $99,000 and will generate $38,000 in net cash
A shoe manufacturer is evaluating new equipment that would custom fit athletic shoes. The new equipment costs $99,000 and will generate $38,000 in net cash flows for five years. (Negative cumulative cash flows should be indicated with a minus sign.) Determine the break-even time for this equipment. Present Present Value Cumulative Present Year Net Cash Flow Value of 1 at 15% = of Net Cash Flows Value of Net Cash Flows Initial investment $ (99,000) x 1.0000 = $ (99,000) $ (99,000) Year 1 38,000 x 0.8696 = Year 2 38,000 x 0.7561= Year 3 38,000 x 0.6575 = Year 4 38,000 x 0.5718 = Year 5 38,000 x 0.4972 = (Round break-even time answers to two decimal places.)
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