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PLEASE HELP. ON THE FIRST TWO PICS I ONLY NEED THE BOTTOM HALF Sentinel Company is considering an investment in technology to improve its operations.
PLEASE HELP. ON THE FIRST TWO PICS I ONLY NEED THE BOTTOM HALF
Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial outlay of $245,000 and will yield the following expected cash flows. Management requires investments to have a payback period of 3 years, and it requires a 10% return on investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the table provided.) Period 1 2 3 4 5 U WNP Cash Flow $ 48,200 53,000 77,000 94,400 126,300 Required: 1. Determine the payback period for this investment. 2. Determine the break-even time for this investment. 3. Determine the net present value for this investment. Required 1 Required 2 Required 3 Determine the payback period for this investment. (Enter cash outflows with a minus sign. to 1 decimal place.) Cumulative Net Cash inflow Year Cash Inflow (outflow) (outflow) 0 $ (245,000)| $ (245,000) 1 48,200 (196,800) 2 53,000 (143,800) 3 77,000 (66,800) 4 94,400 27,600 5 126,300 153,900 153,900 Calculate the payback period: Payback occurs between year: 3 Calculate the portion of the year: Numerator for partial year Denominator for partial year and year: 4 0 Payback period = 3.7 years Required 1 Required 2 Required 3 Determine the break-even time for this investment. (Enter cash outflows with a minus sign. Round y answer to 1 decimal place.) Year Cash inflow (outflow) Table factor Present Value of Cash Flows Cumulative Present Value of Cash Flows 0 1.0000 1 0.9090 $ 2 0.8260 | (245,000) 48,200 53,000 77,000 94,400 126,300 153,900 (245,000) $ 43,814 43,778 57,827 64,475 78,432 (245,000) (201,186) (157,408) (99,581) (35,106) 43,326 3 0.7510 $ 4 0.6830 $ $ 5 0.6210 Calculate the break even time: Break-even time occurs between year: 3 and year: 4 Calculate the portion of the year: Numerator for partial year Denominator for partial year 0 Break-even time = 4.5 years Required 1 Required 2 Required 3 Determine the net present value for this invest Net present valueStep by Step Solution
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