(Answered) Question - paula bought a machine costing 1000 which will

Accounting

Question - Paula bought a machine costing $1,000, which will produce cash inflows of $1,400 over the next 4 years. Determine the payback period given the following cash flows.

Year After-Tax Cash Flows Cumulative Cash Flows

1 $400 $400

2 300 700

3 500 1,200

4 200 1,400

a. 2 years

b. 2.60 years

c. 2.86 years

d. 3 years

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