Park Co. is considering an investment that requires immediate payment of $35,500 and provides expected cash inflows of $12,800 annually for four years. What is the investment's payback period?

Payback Period

Choose Numerator:/Choose Denominator:=Payback Period/=Payback period=

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2) Beyer Company is considering the purchase of an asset for $220,000. It is expected to produce the following net cash flows. The cash flows occur evenly within each year.

Year 1 Year 2 Year 3 Year 4 Year 5 Total Net cash flows $ 63,000 $ 34,000 $ 63,000 $ 150,000 $ 27,000 $ 337,000

Compute the payback period for this investment. (Cumulative net cash outflows must be entered with a minus sign. Round your Payback Period answer to 2 decimal place.)

Year Cash Inflow (Outflow) Cumulative Net Cash Inflow (Outflow)

0 (220,000)

1

2

3

4

5

Payback period =

3)

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Project A requires a $325,000 initial investment for new machinery with a five-year life and a salvage value of $46,500. The company uses straight-line depreciation. Project A is expected to yield annual net income of $25,900 per year for the next five years. Compute Project A's accounting rate of return.

Accounting Rate of Return

Choose Numerator:/Choose Denominator=Accounting rate of return

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