Major Corp. is considering the purchase of a new machine for $5,000 that will have an estimated useful life of 5 years and no salvage value. The machine will increase Major's after-tax cash flow by $2,000 annually for 5 years. Major uses the straight-line method of depreciation and has an incremental borrowing rate of 10%. The present value factors for 10% are as follows:Using the payback method, how many years will it take to pay back Major's initial investment in the machine?
+2
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Major Corp. is considering the purchase of a new machine for $5,000 that will have an estimated useful life of 5 years and no salvage ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Home » Business » Major Corp. is considering the purchase of a new machine for $5,000 that will have an estimated useful life of 5 years and no salvage value. The machine will increase Major's after-tax cash flow by $2,000 annually for 5 years.