Question
Gomez Corporation is considering two alternative investment proposals with the following data: Proposal X Proposal Y Investment $850,000 $467,000 Useful life 6 years 6 years
Gomez Corporation is considering two alternative investment proposals with the following data:
| Proposal X | Proposal Y | ||
| Investment | $850,000 | $467,000 | |
| Useful life | 6 years | 6 years | |
| Estimated annual net cash inflows for 6 years | $145,000 | $81,000 | |
| Residual value | $11,325 | - | |
| Depreciation method | Straightline | Straightline | |
| Required rate of return | 20% | 10% |
How long is the payback period for Proposal X?
A.
5.86
years
B.
5.77
years
C.
75.06
years
D.
10.49
years
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IT Audit In China
Authors: LIU Ruzhuo
1st Edition
981428145X, 978-9814281454
