The management of River Corporation is considering the purchase of a new machine costing $380,000. The company's desired rate of return is 6%. The present value factor for an annuity of $1 at the interest of 6% for 5 years is 4.212. In addition to the foregoing information, use the following data in determining the acceptability of this investment:Year Income from Operations Net Cash Flow1 $20,000 $95,0002 $20,000 $95,0003 $20,000 $95,0004 $20,000 $95,0005 $20,000 $95,000
The cash payback period for this investment is:
a. 5 yearsb. 4 yearsc. 3 yearsd. 20 years
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The management of River Corporation is considering the purchase of a new machine costing $380,000. The company's desired rate of return is ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
The supplies account had a balance of $4,400 at the beginning of the year and was debited during the year for $2,400, representing the total of supplies purchased during the year.
Answers (1)
The Absolute Zero Co. just issued a dividend of $3.40 per share on its common stock. The company is expected to maintain a constant 4.5 percent growth rate in its dividends indefinitely.
Answers (1)
Which best describes what happens to a corporation after its owners retire? It shuts down operations. It transfers to new owners. It continues in business. It sells out to shareholders.
Answers (1)
A college has found that some of its graduating students accept offers from Amazon that pay less than offers at other companies.
Answers (1)
Calculate free cash flow for Amazon for the current and prior years, and discuss its ability to finance expansion from internally generated cash. Thus far Amazon has avoided purchasing large warehouses. Instead, it has used those of others.
Answers (1)
New Questions in Business
When there are many producers and many consumers in an economy, the best way to achieve an efficient allocation of resources is to have a A. single planner who makes all production decisions and allocates all goods and services to consumers. B.
Answers (1)
Consider the market in which clothing producers operate. Suppose productivity decreases in the factory producing jeans. Explain how this event will change the quantity of jeans supplied and the supply of jeans today. A.
Answers (1)
Jones Manufacturing sent Blue Company an invoice for equipment with a list price of $10,000. The invoice is dated July 27 with terms of 2/10, EOM. Blue Company is entitled to a 40% trade discount.
Answers (1)
Suppose a plaintiff hires a lawyer to represent her in a court case. The lawyer will receive a share of the settlement if the plaintiff wins. Under this contract A. the risk is shared. B. the lawyer bears all of the risk. C.
Answers (1)
Stanley, Inc.'s 2018 income statement reported net sales of $6,000,000, uncollectible accounts expense of $160,000, and net income of $7,000,000. Stanley's average accounts receivable during 2018 amounted to $1,200,000.
Answers (1)