60.1K

Verified Solution

Link Copied!

Requirement 1. Calculate the payback period and the discounted payback period for this investment, assuming Merganser expects to generate $160,000 in incremental revenues every year from the new machines. (Round your answer to two decimal places.) The payback period for the investment assuming uniform net cash inflows is ars. The discounted payback period for the investment assuming uniform net cash inflows isears Requirement 2. Assume instead that Merganser expects an uneven stream of incremental cash revenues from installing the new washing machines. Based on this estimated revenue stream, what are the payback and discounted payback periods for the investment? Start by determining the net initial investment unrecovered amounts at the end of each year by first entering the net cash inflow(outflow) amounts and then calculating the cumulative net cash flows for each year. (Use a minus sign or parentheses for net cash outflows and to show negative cumulative net cash flows. Once the net initial investment is fully recovered enter a zero for that year's line and for each subsequent year's line in the "net initial investment unrecovered at end of year" column.) Net Cash Cumulative Net Net initial investment Year Inflowl(Outflow) Cash Flows unrecovered at end of year 0) 92.0 Using the table you completed above and straight-line interpolation, calculate the investment's payback. (Round your answer to two decimal places.) The payback period for the investment assuming nonuniform net cash inflows is 4.70 years

Answer & Explanation Solved by verified expert

See Answer