Compute the discounted payback statistic for Project D if the appropriate cost of capital is 12...

Free

60.1K

Verified Solution

Question

Finance

Compute the discounted payback statistic for Project D if theappropriate cost of capital is 12 percent and the maximum allowablediscounted payback is four years. (Do not roundintermediate calculations and round your final answer to 2 decimalplaces. If the project does not pay back, then enter a "0"(zero).)

Project D
Time:012345
Cash flow:–$12,400$3,490$4,460$1,800$0$1,280

Answer & Explanation Solved by verified expert
3.8 Ratings (688 Votes)

Ans 0 (zero)

Since the amount cannot be recovered during the lifetime of the project.

Year Project Cash Flows (i) DF@ 12% (ii) PV of Project A ( (i) * (ii) ) Cumulative Cash Flow
0 -12400 1                           (12,400.00)              (12,400.00)
1 3490 0.893                              3,116.07                (9,283.93)
2 4460 0.797                              3,555.48                (5,728.44)
3 1800 0.712                              1,281.20                (4,447.24)
4 0 0.636                                           -                  (5,728.44)
5 1280 0.567                                  726.31                (3,720.93)
NPV                             (3,720.93)

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

Compute the discounted payback statistic for Project D if theappropriate cost of capital is 12 percent and the maximum allowablediscounted payback is four years. (Do not roundintermediate calculations and round your final answer to 2 decimalplaces. If the project does not pay back, then enter a "0"(zero).)Project DTime:012345Cash flow:–$12,400$3,490$4,460$1,800$0$1,280

Other questions asked by students