Determine the payback period for this investment

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Reference no: EM132778648

Problem - Sentinel Company is considering an investment in technology to improve its operations. The investment will require an initial outlay of $253,000 and will yield the following expected cash flows. Management requires investments to have a payback period of 2 years. and it requires a 7% return on investments.

Period

Cash Flow

1

$48,100

2

52,600

3

76,700

4

94,600

5

126,800

Required -

1. Determine the payback period for this investment.

2. Determine the break-even time for this investment.

3. Determine the net present value for this investment.

Reference no: EM132778648

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