O'Mally Department Stores is considering two possible expansion plans.One proposal involves opening 5 stores in Indiana at the cost of $1,920,000.Under the other proposal,the company would focus on Kentucky and open 6 stores at a cost of $2,500,000.The following information is available:

The payback period for the Indiana proposal is closest to

Question

O'Mally Department Stores is considering two possible expansion plans.One proposal involves opening 5 stores in Indiana at the cost of $1,920,000.Under the other proposal,the company would focus on Kentucky and open 6 stores at a cost of $2,500,000.The following information is available:

The payback period for the Indiana proposal is closest to

Quizplus · Accepted Answer

C)
Investment/Annual cash flows
$1,920,000/400,000 = 4.8 yrs

O'Mally Department Stores Is Considering Two Possible Expansion Plans