First Choice Carpets is considering purchasing new weaving equipment costing $730,000.The company's management has estimated that the equipment will generate cash inflows as follows:

Considering the residual value is zero,calculate the payback period.(Round your answer to two decimal places. )

Question

First Choice Carpets is considering purchasing new weaving equipment costing $730,000.The company's management has estimated that the equipment will generate cash inflows as follows:

Considering the residual value is zero,calculate the payback period.(Round your answer to two decimal places. )

Quizplus · Accepted Answer

B)
 11ea86ed_2ac9_0690_8b27_572269ac09be_TB3056_00 Payback = 3 years + ($730,000 ? $674,000)/ $266,000 = 3.21 years

First Choice Carpets Is Considering Purchasing New Weaving Equipment Costing