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An anticipated purchase of equipment for $520,000, with a useful life of 8 years and no residual value, is expected to yield the following annual
An anticipated purchase of equipment for $520,000, with a useful life of 8 years and no residual value, is expected to yield the following annual net incomes and net cash flows:
Year | Net Income | Net Cash Flow |
1 | $60,000 | $90,000 |
2 | 50,000 | 110,000 |
3 | 50,000 | 110,000 |
4 | 72,000 | 100,000 |
5 | 72,000 | 55,000 |
6 | 72,000 | 55,000 |
7 | 72,000 | 40,000 |
8 | 72,000 | 40,000 |
What is the cash payback period?
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