Determine the cash payback period for each proposal.


Proposals M and N each cost $800,000, have 6-year lives, and have expected total cash flows of $1,200,000. Proposal M is expected to provide equal annual net cash flows of $200,000, while the net cash flows for Proposal N are as follows:

Year 1 $250,000
Year 2 $225,000
Year 3 $200,000
Year 4 $200,000
Year 5 $175,000
Year 6 $150,000

Determine the cash payback period for each proposal.

 

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Accounting Basics: Determine the cash payback period for each proposal.
Reference No:- TGS091735

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