What is the payback period on the investment

Assignment Help Finance Basics

Reference no: EM131922914

Question: 1. Northern Specialties just purchased inventory-management computer software at a cost of $1,241,950. Cost savings from the investment over the next six years will produce the following cash flow stream: $146,340, $263,240, $296,600, $526,250, $720,320, and $565,740. What is the payback period on this investment? (Round answer to 2 decimal places,e.g. 15.25.) Payback period is what amount of years?

2. Management of Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost of $312,500. They project that the cash flows from this investment will be $134,000 for the next seven years. If the appropriate discount rate is 14 percent, what is the NPV for the project? (Enter negative amounts using negative sign, e.g. -45.25. Do not round discount factors. Round answer to 2 decimal places, e.g. 15.25.)

Reference no: EM131922914

Questions Cloud

How might you respond effectively to this unknown : Your team has never conducted user testing, so this is an unknown. How might you respond effectively to this unknown?

Calculate the cpi and spi : You are the project manager for a project to add functionality to your company's web site. The project has been broken down into four iterations (releases).

How far can walmart stock rise before you get a margin call : Suppose that your broker requires a minimum maintenance margin of 25%. How far can Walmart stock rise before you get a margin call?

Develop a media strategy that would appeal to people : What is it about shows like The Daily Show, The Colbert Report and John Oliver's "Last Week Tonight" that attracts younger viewers?

What is the payback period on the investment : Northern Specialties just purchased inventory-management computer software at a cost of $1,241,950. Cost savings from the investment over the next six years.

What is the project accounting rate of return : Capitol Corp. management is expecting a project to generate after-tax income of $77,270 in each of the next three years.

How many life-cycle phases should be part of a project : As project management matures, would you expect the number of life-cycle phases to increase or decrease? Why?

What are examples of the four types of risk mitigation : Assume that you are considering the purchase of a house. What are examples of each of the four types of risk mitigation that are associated with buying a house?

What would be your first action : On what activities would you tell Mr. Phillips you intended to focus? Why and What would be your first action, and why

User Account

All Pages