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Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial outlay of $253,000 and will yield the
Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial outlay of $253,000 and will yield the following expected cash flows. Management requires investments to have a payback period of 2 years, 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 table provided.) Period Cash Flow $ 48,800 52,700 76,200 4 95,400 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. Required Required Required 1 2 | 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 Cumulative Cash inflow Net Cash (outflow) Inflow (outflow) $ (253,000) | 0 AWN | Payback period = Required Required Required 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.) Table Present Value of Cash inflow (outflow) Year Cumulative Present Value of factor Cash Flows Cash Flows $ (253,000) 0 1 Break-even time =P Determine the net present value for this investment. Net present value
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