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    Calculating payback period in the given case

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    Sewart Associates is considering a project that has the following cash flow data. What is the project's payback?
    Year Cash flow
    0 ($1000)
    1 $300
    2 $310
    3 $320
    4 $330
    5 $340

    a. 2.11 years
    b. 2.34 years
    c. 2.60 years
    d. 2.89 years
    e. 3.21 years.

    © BrainMass Inc. brainmass.com June 3, 2020, 11:46 pm ad1c9bdddf
    https://brainmass.com/business/capital-budgeting/capital-budgeting-technique-payback-period-297139

    Solution Preview

    Solution is attached as MS Excel file also.

    Solution

    Year Cash inflow Total cash inflow
    1 300 300
    2 310 ...

    Solution Summary

    Solution describes the steps to calculate payback period in the given case.

    $2.19

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