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Salsa Company is considering an investment in technology to improve its operations. The investment costs $242,000 and will yield the following net cash flows.
Salsa Company is considering an investment in technology to improve its operations. The investment costs $242,000 and will yield the following net cash flows. Management requires a 9% return on investments. (PV of $1, EV of $1, PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Year Net cash Flow $ 48,600 53,400 76,900 4 94,400 5 125,200 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. 4. Should management invest in this project based on net present value? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Determine the payback period for this investment. (Enter cash outflows with a minus sign. Round your Payback Period answer to 1 decimal place.) Year Net Cash Flows Cumulative Net Cash Flows Initial investment $ (242,000) Year 1 48,600 (48,600) Year 2 53,400 102,000 Year 3 76,900 178,900 Year 4 94,400 273,300 Year 5 125,200 Payback period 3.7 years < Required T Required 2 > Salsa Company is considering an investment in technology to improve its operations. The Investment costs $242,000 and will yield the following net cash flows. Management requires a 9% return on investments. (PV of $1. EV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Year 3 5 Required: Net cash Flow $ 48,600 53,400 76,900 94,400 125,200 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. 4. Should management invest in this project based on net present value? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Determine the break-even time for this investment. (Enter cash outflows with a minus sign. Round your break-even time answer to 1 decimal place.) Year Net Cash Flows Present Value Present Value of Net Cash Flows of 1 at 9% per Year Initial investment $ (242,000) Year 1 Year 2 Year 3 Year 4 Year 5 Break-even time= Cumulative Present Value of Net Cash Flows years 0 0 0 Salsa Company is considering an investment in technology to improve its operations. The Investment costs $242,000 and will yield the following net cash flows. Management requires a 9% return on investments. (PV of $1. EV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Year 12345 Net cash Flow $ 48,600 53,400 76,900 94,400 125,200 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. 4. Should management invest in this project based on net present value? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Requir3 Required 4 Determine the net present value for this investment. Net present value Salsa Company is considering an investment in technology to improve its operations. The investment costs $242,000 and will yield the following net cash flows. Management requires a 9% return on investments. (PV of $1, FV of $1, PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Year 2 Net cash Flow $ 48,600 53,400 76,900 3 4 94,400 5 125,200 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. 4. Should management invest in this project based on net present value? Complete this question by entering your answers in the tabs below. Required 1 Required 2 RequirJ3 Required 4 Determine the net present value for this investment. Net present value Required 2 Required 4 >
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