A project has a cost (projected outflow of ($14,000) in year 0.
This project has the following projected inflows in years 1-5:
year 1 $ 2,000
year 2 $ 4,000
year 3 $ 7,000
year 4 $ 7,000
year 5 $ 7,000.
When is the pay back? (year / months)___________________
If this firm has a payback policy of 3 years, will this project meet that criteria?_____________© BrainMass Inc. brainmass.com October 9, 2019, 7:35 pm ad1c9bdddf
Under the Payback Method, we compute the amount of time required for an investment to generate cash inflows sufficient to recover its initial cost. Based on this method, an investment is acceptable if its calculated payback period is less than some prespecified number of years. ...
Payback Method is utilized in the solution.