A company produces two boat models, Flyer and Skimmer. Both products are being considered for major investment projects next year. Relevant data follow:
Flyer Skimmer
New investment ……………….. $424,000 $380,000
Expected 3-year net cash flows:
Year 1 150,000 130,000
Year 2 160,000 130,000
Year 3 170,000 130,000
Required:
Use the payback period to evaluate these two investment projects.

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The Answer of A company produces two boat models, Flyer and Skimmer. Both products are being considered for major investment projects next year. Relevant data follow:
Flyer Skimmer
New investment ……………….. $424,000 $380,000
Expected 3-year net cash flows:
Year 1 150,000 130,000
Year 2 160,000 130,000
Year 3 170,000 130,000
Required:
Use the payback period to evaluate these two investment projects.

A Company Produces Two Boat Models, Flyer and Skimmer