The cash payback period is calculated by dividing the cost of the capital investment by the

Question

Quizplus · Accepted Answer

The cash payback period is calculated by dividing the cost of the capital investment by the net annual cash inflow. This helps to determine how long it will take for the investment to generate enough cash to pay for itself. Option A is incorrect because it uses annual net income instead of net annual cash inflow. Option C and D are incorrect because they use the present value of cash inflow and net income, respectively, which is not necessary for calculating the cash payback period.

The Cash Payback Period Is Calculated by Dividing the Cost