United Co. is considering investing in new equipment that will cost $1400000 with a 10-year useful life. The new equipment is expected to produce annual net income of $60000 over its useful life. Depreciation expense using the straight-line rate is $140000 per year.
Instructions
Compute the cash payback period.

Question

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The Answer of United Co. is considering investing in new equipment that will cost $1400000 with a 10-year useful life. The new equipment is expected to produce annual net income of $60000 over its useful life. Depreciation expense using the straight-line rate is $140000 per year.
Instructions
Compute the cash payback period.

United Co Is Considering Investing in New Equipment That Will Cost