Problemcreighton inc has invested 2165800 on equipment the, Ask an Expert

Accounting

Problem:

Creighton, Inc. has invested $2,165,800 on equipment. The firm uses payback period criteria of not accepting any project that takes more than four years to recover costs. The company anticipates cash flows of $424,386, $512,178, $561,755, $764,997, $816,500, and $825,375 over the next six years.

Required:

Question: What is the payback period, and does this investment meet the firm's payback criteria?

Note: Show all workings.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91172723

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