Determine the cash payback period for each, Ask an Expert

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Proposals L and K each cost $500,000, have 6-year lives, and have expected total cash flows of $720,000. Proposal L is expected rto providew equal annual net cash flows of $120,000, while the net cash flows for Proposal K are a follows:

Year 1 $250,000
Year 2 200,000
Year 3 100,000
Year 4 90,000
Year 5 60,000
Year 6 20,000
Total $720,000

Determine the cash payback period for each proposal.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M995042

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