If the net initial investment is $6850000 and the uniform increases yearly cash flows is $2050000, then payback period will be _____________?
Correct answer: A. 3.34 years
- A. 3.34 years
- B. 4.34 years
- C. 5.34 years
- D. 6.34 years
Explanation
Payback period is calculated as net initial investment divided by uniform annual cash flow: $6,850,000 ÷ $2,050,000 = 3.34 years. Therefore, option a is correct.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
Practise Cost Accounting
941 free Cost Accounting MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Cost Accounting questions
If the net initial investment is $985000, returned working capital is $7500, then an average investment over five years will be ___________?
The categories of cash flows include __________?
The net initial investment is divided by uniform increasing in future cash flows to calculate __________?
The vertically upward dimension of cost analysis is also called __________?
The process of making long term decisions, for capital investment in the projects is called __________?
The capital budgeting method to analyze information of financials include ___________?