Question

b) The JLK Corporation is considering an investment that will cost RM80, 000 and have a...

b) The JLK Corporation is considering an investment that will cost RM80, 000 and have a useful life of 4 years. During the first 2 years, the net incremental after-tax cash flows are RM25, 000 per year and for the last two years they are RM20, 000 per year. Calculate the payback period for this investment.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A company is considering an investment that will cost $760,000 and have a useful life of...
A company is considering an investment that will cost $760,000 and have a useful life of 5 years. The cash flows from the project are expected to be $432,000 per year in the first two years then $131,000 per year for the last 3 years. If the appropriate discount rate is 15.4 percent per annum, what is the NPV of this investment (to the nearest dollar)? Select one: a. $161861 b. $1681861 c. $182043 d. $235873
The following details are provided by a manufacturing​ company: Product line Investment $ 1 comma 000...
The following details are provided by a manufacturing​ company: Product line Investment $ 1 comma 000 comma 000 Useful life 15 years Estimated annual net cash inflows for first year $ 500 comma 000 Estimated annual net cash inflows for second year $ 430 comma 000 Estimated annual net cash inflows for next ten years $ 140 comma 000 Residual value $ 70 comma 000 Depreciation method Straightminusline Required rate of return 15​% Calculate the payback period for the investment.​...
ABC Company is considering an investment that will cost the company $460 at time=0. The after-tax...
ABC Company is considering an investment that will cost the company $460 at time=0. The after-tax cash flows are expected to be $104 each year for 7 years. What is the payback period?
Vandezande Inc. is considering the acquisition of a new machine that costs $367,000 and has a...
Vandezande Inc. is considering the acquisition of a new machine that costs $367,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are (Ignore income taxes.): Incremental Net Operating Income Incremental Net Cash Flows Year 1 74,000 154,000 Year 2 80,000 159,000 Year 3 91,000 175,000 Year 4 54,000 156,000 Year 5 96,000 158,000 Assume cash flows occur uniformly throughout...
You are evaluating a project that will cost $ 456 comma 000​, but is expected to...
You are evaluating a project that will cost $ 456 comma 000​, but is expected to produce cash flows of $ 124 comma 000 per year for 10 ​years, with the first cash flow in one year. Your cost of capital is 11.2 % and your​ company's preferred payback period is three years or less. a. What is the payback period of this​ project?
Richol Corporation is considering an investment in new equipment costing $180,000. The equipment will be depreciated...
Richol Corporation is considering an investment in new equipment costing $180,000. The equipment will be depreciated on a straight-line basis over a five-year life and is expected to generate net cash inflows of $45,000 the first year, $65,000 the second year, and $90,000 every year thereafter until the fifth year. What is the payback period for this investment? The equipment has no residual value. 2.37 years 2.00 years 2.78 years 4.00 years
The management of Daytona Industries, an interior design company, is considering a R250 000 investment in...
The management of Daytona Industries, an interior design company, is considering a R250 000 investment in a high-quality booking system with the following cash flows: Year Cash Inflow 1 R 30 000 2 R 60 000 3 R120 000 4 R130 000 5 R160 000 1.1. Determine the payback period of the investment. (Present in table format)
The management of Iroquois National Bank is considering an investment in automatic teller machines. The machines...
The management of Iroquois National Bank is considering an investment in automatic teller machines. The machines would cost $129,250 and have a useful life of seven years. The bank’s controller has estimated that the automatic teller machines will save the bank $27,500 after taxes during each year of their life (including the depreciation tax shield). The machines will have no salvage value. 1. Compute the payback period for the proposed investment. in years. 2. Compute the net present value of...
A proposed investment has a project life of four years. The necessary equipment will cost of...
A proposed investment has a project life of four years. The necessary equipment will cost of $1,200, and have a useful life of 4 years. The cost will be depreciated straight-line to a zero salvage value, but will have a market worth $500 at the end of the project’s life. Cash sales will be $2,190 per year for four years and cash costs will run $670 per year. Fixed cost is $176 per year. The firm will also need to...
Drake Corporation is reviewing an investment proposal. The initial cost is $105,000. Estimates of the book...
Drake Corporation is reviewing an investment proposal. The initial cost is $105,000. Estimates of the book value of the investment at the end of each year, the net cash flows for each year, and the net income for each year are presented in the schedule below. All cash flows are assumed to take place at the end of the year. The salvage value of the investment at the end of each year is assumed to equal its book value. There...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT