Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A small accounting firm is considering the purchase of a computer software package that would greatly reduce the amount of time needed to prepare tax

A small accounting firm is considering the purchase of a computer software package that would greatly reduce the amount of time needed to prepare tax forms. The software costs $2350 and this expense will be incurred immediately. The firm estimates that it will save $775 of cash flow at the end of each year beginning in one year for 5 consecutive years, and also save $2131 in year 6. What is the payback on the computer package?

Because payback is typically defined as an integer (e.g. 3 years and not as 3.74 years), place your answer as an integer.

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

Recommended Textbook for

Personal Finance

Authors: E. Thomas Garman, Raymond E. Forgue

13th edition

1337099759, 978-1337516440, 1337516449, 978-1337099752

More Books

Students also viewed these Finance questions

Question

How do the events of normal aging affect life satisfaction?

Answered: 1 week ago