An anticipated purchase of equipment for $520,000, with a useful life of 8 years and no...
An anticipated purchase of equipment for $520,000, with a useful life of 8 years and no residual value, is expected to yield the following annual net incomes and net cash flows:
| Year | Net Income | Net Cash Flow | ||
| 1 | $60,000 | $120,000 | ||
| 2 | 50,000 | 110,000 | ||
| 3 | 50,000 | 110,000 | ||
| 4 | 40,000 | 100,000 | ||
| 5 | 40,000 | 80,000 | ||
| 6 | 40,000 | 80,000 | ||
| 7 | 40,000 | 60,000 | ||
| 8 | 40,000 | 60,000 | ||
What is the cash payback period?
a.5 years
b.4 years
c.3 years
d.6 year
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An anticipated purchase of equipment for $520,000, with a useful
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