QUESTION 25

1. York Corporation is considering purchasing equipment that costs $100,000 and is expected to provide the following cash inflows over its five-year useful life:
3. Type of cash flow
4. Inflow
5. Outflow
6. Today
7. Purchase Price
9. $100,000
10. YR 1
11. Revenue
12. $40,000
14. YR 2
15. Revenue
16. $25,000
18. YR 3
19. Revenue
20. $20,000
22. YR 4
23. Revenue
24. $15,000
26. YR 5
27. Revenue
28. $10,000
30. What is the payback period of this investment project using the accumulated cash flows approach?
31. a.2 years
32. b.5 years
33. c.3 years
34. d.4 years