Baxter's Market is considering opening a new location with an initial cost of $139,200.This location is expected to generate cash flows of $22,400,$61,500,$37,800,and $21,000 in Years 1 to 4,respectively.What is the payback period?
A)3.92 years
B)3.83 years
C)2.46 years
D)2.57 years
E)3.01 years

Question

Quizplus · Accepted Answer

Payback period = 3 + ($139,200 - $22,400 - $61,500 - $37,800)/ $21,000 = 3.83 years

Baxter's Market Is Considering Opening a New Location with an Initial