I need oblige in finding the discount payback spell in this example so can someone please serve in finding the discount payback term
Year Cash Flow
0 –(this is a negative)$ 189,296
1 $26,800
2 $51,000
3 $57,000
4 $384,000
Whichever project you choose, if any, you require a 15 percent return on your investment.
So explain to me how you get the discounted payback spell in this problem. Thanks
Answers: Use a time appeal of money table (present value of a dollar) and verbs the factor corresponding to 15% and the year and multiply this factor by the dollar value surrounded by that year (e.g. use the table to find a factor corresponding to 15% and year 1 and multiply it by $26,800). With these "discounted" values you can now determine the payback term as normal.
Year Cash Flow
0 –(this is a negative)$ 189,296
1 $26,800
2 $51,000
3 $57,000
4 $384,000
Whichever project you choose, if any, you require a 15 percent return on your investment.
So explain to me how you get the discounted payback spell in this problem. Thanks
Answers: Use a time appeal of money table (present value of a dollar) and verbs the factor corresponding to 15% and the year and multiply this factor by the dollar value surrounded by that year (e.g. use the table to find a factor corresponding to 15% and year 1 and multiply it by $26,800). With these "discounted" values you can now determine the payback term as normal.