PAYBACK PERIOD Project L costs $65,000, its expected cash inflows are $14,000 per year for 11...

PAYBACK PERIOD

Project L costs $65,000, its expected cash inflows are $14,000 per year for 11 years, and its WACC is 9%. What is the project's payback? Round your answer to two decimal places.

__ years

Expert Solution

Calculation of payback period :
Time	Amount	Cumulative
-	(65,000.00)	(65,000.00)
1.00	14,000.00	(51,000.00)
2.00	14,000.00	(37,000.00)
3.00	14,000.00	(23,000.00)
4.00	14,000.00	(9,000.00)
5.00	14,000.00	5,000.00
6.00	14,000.00	19,000.00
7.00	14,000.00	33,000.00
8.00	14,000.00	47,000.00
9.00	14,000.00	61,000.00
10.00	14,000.00	75,000.00
11.00	14,000.00	89,000.00


Payback Period= 4+9000/14000
Payback Period= 4.64 years

jeff jeffy answered 1 year ago

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