Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

be purchased for $277,000 and used for five years, yielding the following net incomes. In projec ng depreciation is applied using a five-year life and

image text in transcribed

image text in transcribed

be purchased for $277,000 and used for five years, yielding the following net incomes. In projec ng depreciation is applied using a five-year life and a zero salvage value. Year 1 $25,000 Year 2 $45,000 Year 3 $57,000 Year 4 $46,500 Year 5 $133,000 machine's payback period (ignore taxes). (Round payback period answer to 3 decimal places.) Answer is complete but not entirely correct. Ending Book Value Computation of Annual Depreciation Expense Annual Depr. Accumulated Beginning (40% of Book Depreciation at Book Value Value) Year-End 277 000 110.800 110.800 166.200 66.480 177 280 99 720 39 888 217,168 59,832 23.933 241,101 35,899 14.360 X 255 461 166,200 99,720 59,832 35,899 21,539 Annual Cash Flows Cumulative Net income nenreriation Natinash Flow Annual Cash Flows Year Net income Depreciation Net Cash Flow 0 1 110 800 135,800 Cumulative Cash Flow $ (277,000) (141, 200) (29,720) 67,168 137,601 284,961 2 66 480 $ (277.000) 25,000 45,000 57,000 46,500 133,000 111.480 3 39,888 4 23933 96,888 70,433 147,360 5 14 360 Payback period = 2.192 X

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

Fundamentals Of Financial Planning

Authors: Michael A Dalton, Joseph Gillice

3rd Edition

1936602091, 9781936602094

More Books

Students also viewed these Finance questions

Question

Describe contextual influences on direct financial compensation.

Answered: 1 week ago

Question

Describe legally required benefits.

Answered: 1 week ago

Question

Discuss career development and career development methods.

Answered: 1 week ago