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Te machine will increase majors cash flows by 2000

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Major Corporation is considering the purchase of a new machine for $5,000. The machine has an estimated useful life of 5 years and no salvage value. The machine will increase Major"s cash flows by $2,000 annually for 5 years. Major uses straight-line depreciation. The company"s required rate of return is 10%. What is the payback period for the machine?

A) 5.00 years

B) 2.50 years

C) 7.58 years

D) 8.34 years

Reference no: EM13567129

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