Cash Payback Period RiverBend Wood is evaluating two capital investment proposals for a retail outlet store, each requiring an investment of $1,007,000 and each with a five-year life and expected total net cash flows of $1,258,750. Location 1 is expected to provide equal annual net cash flows of $251,750, and Location 2 is expected to have the following unequal annual net cash flows: Year 1 $403,000 Year 2 373,000 Year 3 231,000 Year 4 178,600 Year 5 73,150 Determine the cash payback period for both location proposals. Location 1 fill in the blank 1 years Location 2 fill in the blank 2 year
Cash Payback Period RiverBend Wood is evaluating two capital investment proposals for a retail outlet store, each requiring an investment of $1,007,000 and each with a five-year life and expected total net cash flows of $1,258,750. Location 1 is expected to provide equal annual net cash flows of $251,750, and Location 2 is expected to have the following unequal annual net cash flows: Year 1 $403,000 Year 2 373,000 Year 3 231,000 Year 4 178,600 Year 5 73,150 Determine the cash payback period for both location proposals. Location 1 fill in the blank 1 years Location 2 fill in the blank 2 year
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 5E: Cash payback period for a service company Janes Clothing Inc. is evaluating two capital investment...
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Cash Payback Period
RiverBend Wood is evaluating two capital investment proposals for a retail outlet store, each requiring an investment of $1,007,000 and each with a five-year life and expected total net cash flows of $1,258,750. Location 1 is expected to provide equal annual net cash flows of $251,750, and Location 2 is expected to have the following unequal annual net cash flows:
| Year 1 | $403,000 |
| Year 2 | 373,000 |
| Year 3 | 231,000 |
| Year 4 | 178,600 |
| Year 5 | 73,150 |
Determine the cash payback period for both location proposals.
| Location 1 | fill in the blank 1 years |
| Location 2 | fill in the blank 2 years |
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