Services United is considering a new project that requires an initial cash investment of $78,000.The project will generate cash inflows of $29,500,$32,700,$18,500,and $10,000 over each of the next four years,respectively.How long will it take to recover the initial investment?
A)2.74 years
B)2.85 years
C)2.99 years
D)3.27 years
E)3.68 years

Question

Quizplus · Accepted Answer

Payback = 2 + ($78,000 - $29,500 - $32,700)/$18,500 = 2.85 years

Services United Is Considering a New Project That Requires an Initial