Paybackperiod. What are the payback periods of projects E and F? Assume all the cash flow is evenly spread throughout the year. If the cutoff period is three years, which project(s) do you accept? Cash FlowEF Cost $40,000 $95,000 Cash flow year 1$10,000 $19,000 Cash flow year 2$10,000 $9,500 Cash flow year 3$10,000 $38,000 Cash flow year 4$10,000 $28,500 Cash flow year 5$10,000 $0 Cash flow year 6$10,000 $0

Payback period is time required to recover initially investment of PROJECT.

Answered: Payback period. What are the payback…

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter26: Capital Investment Analysis

Section: Chapter Questions

Problem 4CMA

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Payback

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What are the payback periods of projects E and F? Assume all the cash flow is evenly spread throughout the year. If the cutoff period is three years, which project(s) do you accept?

Cash Flow	E	F
Cost	$40,000		$95,000
Cash flow year 1	$10,000		$19,000
Cash flow year 2	$10,000		$9,500
Cash flow year 3	$10,000		$38,000
Cash flow year 4	$10,000		$28,500
Cash flow year 5	$10,000		$0
Cash flow year 6	$10,000		$0

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