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Cyril Ltd is considering two new items of equipment to be purchased, the expected cash flows of each items are as follows Equipment X Equipment
Cyril Ltd is considering two new items of equipment to be purchased, the expected cash flows of each items are as follows Equipment X Equipment Y Capital cost $180,000 $190,000 Total life 5 years 5 years Cash flows $ $ Y1 60,000 50,000 Y2 50,000 50,000 Y3 40,000 60,000 Y4 40,000 60,000 Y5 30,000 60,000 Disposal value 0 0 Requirement. Calculate Payback for each investment. Which one would you recommend?
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