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 outlay of $258,000 and will yield
Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial outlay of $258,000 and will yield the following expected cash flows. Management requires investments to have a payback period of 4 years, and it requires a 10% return on investments. (PV of $1, FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the table provided.) Period Cash Flow 2 $ 47,300 53,300) 3 75,300 4 5 94,300 125,300 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. 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.) Cash inflow Cumulative Net Cash Year (outflow) Inflow (outflow) 0 S (258,000) 1 2 3 4 5 0 0 0 0
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