Question
The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $60,000 $2,000
| The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: |
| Year | Investment | Cash Inflow |
| 1 | $60,000 | $2,000 |
| 2 | $4,000 | $4,000 |
| 3 | $8,000 | |
| 4 | $9,000 | |
| 5 | $12,000 | |
| 6 | $10,000 | |
| 7 | $8,000 | |
| 8 | $5,000 | |
| 9 | $4,000 | |
| 10 | $4,000 | |
| Required: | |
| 1. | Determine the payback period of the investment. (Round your answer to 1 decimal place.) |
| 2. | Would the payback period be affected if the cash inflow in the last year were several times as large? | ||||
|
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Principles Of Auditing
Authors: O. Ray Whittington, Kurt Pany, Walter B. Meigs
12th Edition
0256167796, 978-0256167795
