Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial $244,000 and will yield the following expected
Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial $244,000 and will yield the following expected cash flows. Management requires investments to have a payback period of 4 and it requires a 9% return on investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the t provided.) Period 1 2 3 4 5 Cash Flow $ 48,700 52,000 76,900 95, 100 126,900 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. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the payback period for this investment. (Enter cash outflows with a minus sign. Round your Payback period answer to 1 decimal place.) Year Cash inflow (outflow) Cumulative Net Cash Inflow (outflow) 0 S (244,000) 1 2 3 4 5 Payback period = Required 1 Required 2 > 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 Table factor Present Value of Cash Flows Cash inflow (outflow) (244,000) Cumulative Present Value of Cash Flows 0 S 1 2 3 4 5 Break-even time = Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the net present value for this investment. Net present value
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started