Rihanna Company is considering purchasing new equipment for $452,400. It is expected that the equipment will produce net annual cash flows of $58,000 over its 10-year useful life. Annual depreciation will be $45,240. Compute the cash payback period. (Round answer to 1 decimal place, e.g. 10.5.) Cash payback period years
Answers :Cash Payback Period = 7.8 Years
Cash Payback Period is the time Period Required to Collect the investment
Cash Payback Period = Investment / Annual net Cash Flows = $ 452,400 / 58,000 = 7.8 YEars
Rihanna Company is considering purchasing new equipment for $452,400. It is expected that the equipment will...
Rihanna Company is considering purchasing new equipment for $316,800. It is expected that the equipment will produce net annual cash flows of $44,000 over its 10-year useful life. Annual depreciation will be $31,680. Compute the cash payback period.
Rihanna Company is considering purchasing new equipment for $450,000. It is expected that the equipment will produce net annual cash flows of $60,000 over its 10-year useful life. Annual depreciation will be $45,000. Compute the cash payback period.
Monty Company is considering purchasing new equipment for $453,600. It is expected that the equipment will produce net annual cash flows of $54,000 over its 10-year useful life. Annual depreciation will be $45,360. Compute the cash payback period. (Round answer to 1 decimal place, e.g. 10.5.) Cash payback period years
Question 8 (5 points) Lina Inc. is considering purchasing new equipment for $600,000. It is expected that the equipment will produce annual profit of $15,000 over its 10-year useful life. The salvage value is expected to be zero. Annual depreciation will be $60,000. Required: Calculate the cash payback period (2 marks) and the annual rate of return (3 marks). Show all of your work / calculations for full marks. (Round the final answer for cash payback to two decimal places,...
Vilas Company is considering a capital investment of $216,000 in
additional productive facilities. The new machinery is expected to
have a useful life of 5 years with no salvage value. Depreciation
is by the straight-line method. During the life of the investment,
annual net income and net annual cash flows are expected to be
$18,468 and $45,000, respectively. Vilas has a 12% cost of capital
rate, which is the required rate of return on the investment.
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