Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufac
turers of tractors. The outlay required is $384,000. The NC equipment will last 5 years with no expected salvage value. The expected after-tax cash flows associated with the project follow: Year Cash Revenues Cash Expenses 1 $510,000 $360,000 2 510,000 360,000 3 510,000 360,000 4 510,000 360,000 5 510,000 360,000 Required: 1. Compute the payback period for the NC equipment. Round your answer to two decimal places.
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Response: appropriate hygiene practices
Justification:
The calculated return on investment stands at 10%. Given the stock purchased for $80 grew to four times that value over 15 years, the return was formulated using the growth rate calculation components leading to a clear estimate.
